Picture it now…
You own a thriving art supply store in your home town of New Orleans. You’ve put years of your life and thousands of dollars into building the store into what it is now. You make a nice living, and the business mostly runs itself at this point.
Then Hurricane Katrina comes to town. The building you lease is ruined. Your storefront and merchandise are ruined. You have no cash flow to pay creditors, and are forced to close the store.
This is a pretty extreme example, but is exactly what happened to thousands of businesses in the wake of the disaster in 2005. It’s also a risk that can be completely covered with business interruption insurance.
Virtually any disaster that is out of your control and risks your business’s profitability can be covered in a business interruption policy. In other words, you can protect business profits and your personal income from a fire, flooding, earthquake, or other disaster.
This post will cover the ins and outs of business interruption insurance. We’ll address what it does and doesn’t cover, when you should consider buying it, how much coverage you need, and how to purchase a policy.