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Business Interruption Insurance
Protect your business during a temporary shutdown.
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What is business interruption insurance?

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Business interruption insurance

If a fire or other incident shuts down operations at your tech company, business interruption insurance can pay for lost revenue, day-to-day expenses, and rent or relocation costs.

When does your tech company need business interruption insurance?

From an interruption in your supply chain to a prolonged power outage, unexpected events could force your tech business to halt its operations. A temporary shutdown can have a long-term impact. When your business isn’t bringing in revenue, the costs of rent, employee wages, and other financial obligations can add up quickly.

Business interruption insurance (or business income insurance) helps your business recover from a forced closure by taking care of day-to-day expenses, lost revenue, or even temporary relocation.

What does business interruption insurance cover?

Business interruption insurance activates alongside covered property insurance claims, such as damage from a storm or fire. It can help cover:

  • Normal operating costs (rent, utility bills, wages, taxes)
  • Relocation costs
  • Lost revenue

Learn more about business interruption insurance coverage.

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Examples of coverage

Here are a few scenarios where business interruption insurance comes in handy:

  • Unintentional damage, like a fire, forces your business to close
  • Intentional damage, like vandalism, forces your business to close
  • A prolonged power outage forces your business to close

Does business interruption insurance cover losses related to the coronavirus (COVID-19)?

Because business interruption insurance is tied to your commercial property policy, it most likely will not cover claims related to the coronavirus. In most cases, your building must undergo physical damage in order for this policy to become active.

Most business insurance policies exclude coverage related to communicable diseases. If you think you might be eligible for a claim, contact your insurance company's claims department.

Business interruption insurance endorsements

Business interruption insurance is attached to your tech business’s commercial property insurance or business owners’ policy (BOP). You can enhance your policy’s basic coverage by adding an insurance endorsement to this rider.

Extra expense coverage

Extra expense coverage takes care of non-ordinary operating costs that can help your business better manage a shutdown. Examples include renting new equipment, paying employees overtime, or hiring extra workers.

Contingent business interruption insurance

If losing a primary supplier, partner, or customer affects your ability to do business, contingent business interruption insurance pays for your ongoing expenses while you search for a replacement. This policy is beneficial if your business relies heavily on a single supplier, partner, or customer.

Which tech companies should purchase business interruption insurance?

No one knows when an unexpected event will force their business to close temporarily. This is why most tech companies could benefit from business interruption insurance. The policy is particularly beneficial if your business’s normal operating costs are high.

To qualify for business interruption insurance, most insurance providers require that your business have a commercial location. If you operate your business out of your home, you likely won’t be able to add business interruption insurance to your business owner’s policy.

Business interruption insurance costs

Business person considering costs of revenue, wages, and location.

The cost of business interruption insurance varies depending on:

  • Commercial property value
  • Operating costs
  • Revenue
  • Previous business interruption claims
View Business Interruption Insurance Costs
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