Business Income (Business Interruption) Insurance
After a fire or major loss, the repair bill is only half the problem. Business income insurance replaces the income you lose and pays the bills that keep coming while you rebuild, so the business is still there when the doors reopen. For property owners, the same coverage protects rent.
Reviewed by Nate Feuerman, High Net Worth Insurance Producer at Stonebrook
Last updated
Quick answers
What is business income insurance?
Coverage for lost net income and continuing expenses, like payroll and rent, when a covered property loss forces you to suspend operations.
Is business income the same as business interruption?
Yes. Business income is the name on most policy forms; business interruption is the common term.
What triggers business income coverage?
Usually a covered direct physical loss to your property, such as a fire or storm damage.
Do landlords need business income coverage?
Yes, as loss of rents or rental value, which replaces rent while units can’t be occupied.
What business income covers.
Lost net income
The profit you would have earned if the loss had not happened.
Continuing expenses
Payroll, rent, loan payments, utilities and other bills that keep coming.
Extra expense
Costs to keep operating or reopen faster, like a temporary location or expedited equipment.
Loss of rents
For property owners, rental income lost while units are being repaired.
Civil authority
Lost income when authorities prohibit access to your premises because of nearby damage.
Contingent business income
Lost income when a key supplier or customer suffers a covered loss.
Terms that decide what you collect.
| Term | What it means |
|---|---|
| Waiting period | The hours after a loss before coverage starts, often 72 hours |
| Period of restoration | How long the policy pays, usually until the property should reasonably be repaired |
| Extended period of indemnity | Additional time after reopening while revenue recovers |
| Coinsurance | A requirement to carry a limit tied to your annual income, or face a reduced payout |
| Actual loss sustained | Pays your actual loss for a set period instead of a fixed dollar limit, on some forms |
How much business income coverage do you need?
Estimate how long it would take to rebuild and fully recover after a total loss, often longer than owners expect, then add up the net income and continuing expenses for that period.
Healthcare operators such as senior living and skilled nursing facilities also face relocation costs for residents. Real estate investors should insure 12 months or more of rents.
Business income is written with your commercial property coverage or inside a BOP. Downtime from a cyber attack is covered by cyber insurance, not property.
A broker who knows your business.
Stonebrook is an independent agency. We work with standard, specialty and excess and surplus lines carriers, so we can shop business income coverage across carriers instead of fitting you into one company’s program.
Since 1982 we have placed commercial programs for businesses and property owners across the country. We read the fine print, flag the exclusions that matter for your operation, and advocate for you at underwriting, at renewal and at claim time.
Coverage that works together.
Most families need more than one policy. Here is how the pieces fit.
Business income questions, answered.
What does business income insurance cover?
It covers lost net income and continuing expenses, such as payroll, rent and loan payments, when a covered loss to your property forces you to suspend operations. Extra expense coverage pays costs to keep operating or reopen sooner.
Is business interruption insurance the same as business income?
Yes. Business income is the term used on most policy forms; business interruption is the common name for the same coverage.
How long does business income coverage last?
Until the property should reasonably be repaired, called the period of restoration, plus any extended period of indemnity you buy. The waiting period, often 72 hours, applies first.
Does business income cover a shutdown without property damage?
Generally not. Coverage usually requires direct physical loss to property. Civil authority and contingent business income extend it in specific situations.
Does business income insurance cover a cyber attack?
Not under a property policy. Downtime from a cyber attack is covered by the business interruption section of a cyber policy.
How do I choose a business income limit?
Estimate the net income and continuing expenses for the full time it would take to rebuild and recover after a total loss. We help you build the worksheet.
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