Restaurant Business Interruption Insurance

A business interruption insurance policy is one that isn’t often discussed, but it’s incredibly important for a small business to carry this type of coverage. As the name suggests, business insurance interruption covers your business when it is forced to temporarily close due to a variety of factors. The protection that this insurance provides essentially comes in the form of income insurance. If your business is unable to operate and generate revenue due to an event that is covered by the business interruption policy, the insurance benefits can help you meet your financial needs for things like rent, orders, and payroll.

Business Interruption Coverage for Restaurants

Business interruption insurance will have a very clear description of what types of events that cause a closure it will cover. Natural disasters, fires, and unsafe structures will almost always be included under the coverage. The insurance doesn’t just stop at assuring your business is OK while it closes, but it can also be used while your business is open. Say a major hurricane comes through the region, but your restaurant is spared. If the very next day you get a call from your main food vendor saying they can’t make any deliveries because of the storm, then how does a restaurant make money without any food to serve? This type of supply chain coverage is called contingent business interruption coverage. Speak with an RPA representative to learn more about this additional coverage.

How Much Business Insurance Do You Need For Your Restaurant?

To determine exactly how much coverage your restaurant or bar would require in the event that you needed to close and lose all sources of income, the best question to ask yourself would be, “What bills and expenses do I still have?” Determining the answer to this question will determine how much coverage you should look to secure for your business. Things like taxes, rent, loan payments, wages, utilities, and more can all continue to accrue during a closure, so once you have added all of the figures up, determine how long a major event would cause your business to shut down and factor out the costs over that length of time. For more help figuring out coverage amounts, coverage areas, and additional methods of protecting your business in the event of a natural disaster, major storm, or fire, speak with a RPA representative by calling 844-358-2296.