As a business owner, you need many types of insurance: workers’ compensation coverage, property protection and liability insurance, to name a few. Perhaps the last thing you want to deal with is another type of insurance policy. 

However, you may have noticed that business interruption insurance has been a hot topic lately. What does business interruption insurance cover? Do you need it? What if you get it and the insurance company denies your claim? Running a small business in uncertain times can be challenging; you need answers you can trust. 

Do I need business interruption insurance? 

Business owners in many industries can benefit from business interruption insurance. Running your business involves many facets. Unfortunately, that means that multiple things can go wrong. Delays anywhere along your supply chain, delivery mechanism or manufacturing process can wreak havoc on your bottom line. Customers may have issues due to natural disasters, job losses and public policy mandates, meaning fewer sales. Any of these events can interrupt your business. 

What can it cover? 

Problems with any of the matters mentioned above can cause your company to slow down or close temporarily. Such delays have serious repercussions on your earnings. A business interruption policy can give you money to pay basic expenses such as rent and taxes. Payroll protection allows you to pay your employees during a period of extended shut-down. You may even be able to pay yourself and make up for lost profits. 

What if it fails?  

Sadly, insurance companies do not always provide everything you need. Sometimes, a business interruption occurs due to a peril the policy should cover, yet the insurance company unreasonably denies the claim. If that happens to you, you can fight for what you deserve by filing a bad faith claim. 

You may be able to collect on a bad faith claim if the insurance company offers much less than what you should legally expect or delays your claim in the hope that you will drop it. Insurance companies must fulfill their legal duties and follow industry standards. If they do not, and you suffer because of their failure, the law is on your side. 

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