The Importance of Business Interruption Insurance
Operating a business means navigating many risks, and unexpected disruptions can quickly lead to financial strain. In fact, Canadian Underwriter reports that "business interruption, including supply chain disruption, is this year’s number one risk for Canadian companies [...] Companies most fear business interruptions driven by cyber incidents and natural catastrophes, followed by fire, machinery breakdown and supplier failure."
That’s why business interruption insurance is essential. It provides vital protection to help your business recover and maintain operations during unforeseen challenges. Discover how this coverage supports business continuity and strengthens long-term resilience.
What Is Business Interruption Insurance?
Business interruption insurance helps protect your income if your operations are temporarily halted due to a covered event. While property insurance covers the cost of physical damage, business interruption insurance goes a step further — covering the lost income and extra expenses you may incur while getting your business back up and running.
There are two common types of business interruption coverage:
Earnings Coverage: Reimburses the income your business would have earned during the downtime, based on historical financial data.
Profits Coverage: Covers the profit your business would have made had the interruption not occurred, helping you maintain expected revenue.
How Business Interruption Insurance Can Help
Interruptions can strike from many directions, and without the right coverage, even a short closure could have long-term financial impacts. Business interruption insurance can be especially valuable in situations such as:
Severe Weather or Natural Disasters: Storms, floods, or extreme weather events that force you to shut down temporarily.
Fire Damage: Losses due to fires that damage your building, inventory, or equipment.
Supply Chain Issues: Delays or shortages from key suppliers that halt your ability to deliver products or services.
Utility Outages: Long-term power or water supply failures make operating your business impossible.
How to Make Sure You’re Properly Covered
Not all business interruption policies are created equal. To ensure your business has the protection it needs, consider the following:
Evaluate Your Risks: Understand your business's specific threats based on your industry, location, and operations.
Know Your Numbers: Review your income statements to determine appropriate coverage.
Add Extra Expense Coverage: This can help with costs like leasing temporary office space or fast-tracking repairs to minimize downtime.
Understand Your Policy: Be clear on the waiting period before coverage kicks in, what’s excluded, and how long your coverage lasts.
Talk to a Broker: Working with a trusted insurance broker — like our team at E. Bollenbach Insurance Brokers — ensures your coverage is tailored to your unique business needs.
Let’s Safeguard Your Business Together
Unplanned closures can happen in an instant. Without proper coverage, the financial toll can be devastating. Business interruption insurance offers peace of mind, allowing you to focus on rebuilding and recovery — not revenue loss.
At E. Bollenbach Insurance Brokers, we can help you review your coverage and find the best policy for your needs. Contact us today at carla@bollenbachinsurance.com or 519-743-6379 to speak with a broker. You can also visit our Commercial Insurance page for more details.