Linen Supply Companies provide a significant service for many businesses across a wide spectrum. Restaurants, hotels, the medical industry, companies employing uniformed guards, laundromats, gyms and spas are just the tip of the iceberg. Imagine if one or more linen companies had to shut down for just one day how many businesses would be affected? The number would likely be staggering, which illustrates how important business interruption insurance is to this burgeoning industry.
As you may well know, business interruption insurance generally steps in when a business is forced to temporarily shut down. It specifically insures the business’s income when a crisis arises and the business must momentarily cease operations. If a business is unable to perform its usual operations because of an event covered by commercial property insurance, policy benefits can help an owner address his or her ongoing expenses.
Coverage is included in Many Business Owners Policies (BOPs)
Business Interruption can often be included in a BOP as part of its commercial property coverage and will provide coverage for lost revenues, including profits would have been earned if the incident did not occur, the day-to-day expenses, including normal operating costs such as employees’ wages, and relocation expenses to move the business to a temporary location, which might also include both moving costs and rent.
Key Components of Business Interruption insurance
Business Interruption coverage helps make ends meet until an owner is able to get their operations back up and running. For example, if you’re running a bakery and your ovens are destroyed due to an electrical fire, you would be able to collect your benefits as long as your business has an underlying property policy in place.
The cause of the interruption must be a covered loss, so if a fire destroys the bakery shop, then this type of an event would generally be covered. If the damage was the result of a flood, without flood insurance you’ll probably be out of luck. Commercial flood insurance is typically a policy purchased separately.
Note that your business must be forced to close completely, so if you’re still operating in any capacity (e.g., out of your home or online) and generating revenue, you won’t be eligible to collect benefits.
Most policies have a time deductible, and therefore Linen Supply Companies often can’t collect benefits until they’ve been shut down for 72 hours, so hopefully you’ll be able to make it on your own through the first three days until benefits become available. The good news is that Business Interruption insurance policies typically offer up to 12 months of coverage while you get your business back up and running.