Business interruption insurance

Coverage to stay afloat if you need to temporarily close or relocate.


What is business interruption insurance?


Business interruption insurance covers the loss of income your business may experience in the event of a disaster. It’s also known as business income insurance  — that’s how we refer to it here at NEXT.

Why would you need business interruption insurance?

Here’s an example of why you need it. Let’s say a neighboring business catches on fire and damages your exterior wall. Yikes. Luckily, nothing in your business was damaged, but you’re forced to shutdown for several weeks while they make repairs.

Common events, or “covered perils” typically include fire, wind damage, ice or hail, theft, and vandalism. Business income insurance can help cover the lost income you would have earned during that time and other business expenses while you are closed.

Who needs business income insurance?

Small business owners who own or rent property in order to operate a business, such as a brick-and-mortar shop, restaurant, studio or office, should consider goods, gear and inventory insurance to help cover all your inventory, equipment, upgrades and furniture.

NOTE: Business income coverage is part of goods and gear/business personal property (BPP) insurance. It typically isn’t available as standalone insurance.

What is covered by business interruption insurance?

Business interruption insurance will help pay certain expenses when you have physical damage up to your coverage limits. These include things like:

Earned profits: The insurance company will look at your past financial statements to assess what you would have earned during that period. They will cover you accordingly.

Temporary location: As you rebuild your business, you will need somewhere to work. Some policies will cover the rent on a temporary location and even the expenses related to relocation costs and operations.

Fixed costs: Even if your office gets destroyed in a fire, you may still have to pay property taxes. The same goes for things like lease payments and certain salaries. Insurance may cover these operating expenses and others based on your prior costs.

Extra costs: Another business interruption claim is the extra expenses you incur while your property gets fixed. For example, additional office supplies or even a new coffee machine if that’s something your business needs to do business as usual.

Training costs: You may require training if you have to use new or different equipment. Business income insurance can cover your training expenses.

As you can see, business interruption insurance coverage can help policyholders pay for many things you need to keep your business running when you have a direct physical loss.

What’s usually not covered by business interruption insurance?

Typically, this insurance doesn’t cover the following:

  • Broken items. Items such as glass resulting from a covered event or loss
  • Flood or earthquake damage. These are usually covered by a separate insurance policy
  • Undocumented income. Any income not found in financial records
  • Airborne and communicable diseases. Common colds, flu, viruses and communicable diseases such as COVID-19.

Be prepared with NEXT

NEXT offers a wide variety of small business insurance coverage, including business personal property coverage with business interruption coverage, aka business income insurance.

You can start a quote, customize your options and access your certificate of insurance online immediately — in about 10 minutes.

Start your instant quote today.

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Let’s find the coverage you need for your business

Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your business.

General Liability insurance
General Liability

Protect yourself from accidents that cause physical injury or damaged property.

Professional Liability or Error and Omissions Insurance
Professional Liability/E&O

Shield yourself from lawsuits that claim your work errors caused financial losses.

Workers' Compensation Insurance
Workers’ Compensation

Cover medical bills and lost wages if your employees have an accident at work.

Commercial Auto Insurance
Commercial Auto

Stay on the road with coverage for dents, tows and damage to someone else’s vehicle.

Tools & Equipment Insurance
Tools & Equipment

Upgrade your general liability coverage to protect any gear that’s stolen, damaged or lost.

Commercial Property Insurance
Commercial Property

Keep your building, inventory and equipment protected from fire or water damage.

Business Owner’s Policy Insurance
Business Owner’s Policy

Combine general liability and commercial property into one policy to protect your business.

Take a look at some helpful blog posts
Commercial Property Insurance: How coverage protects your business

Commercial Property Insurance: How coverage protects your business

Business continuity vs. disaster recovery — what's the difference?

Business continuity vs. disaster recovery — what's the difference?

Create a Small Business Disaster Recovery Plan

Create a Small Business Disaster Recovery Plan

* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
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© 2023 Next Insurance, Inc. 975 California Ave, Palo Alto, CA 94304, United States
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Issuance of coverage is subject to underwriting. Not available in all states. Please see the policy for full terms, conditions and exclusions. Coverage examples are for illustrative purposes only. Your policy documents govern, terms and exclusions apply. Coverage is dependent on actual facts and circumstances giving rise to a claim. Next Insurance, Inc. and/or its affiliates is an insurance agency licensed to sell certain insurance products and may receive compensation from insurance companies for such sales. Policy obligations are the sole responsibility of the issuing insurance company. Refer to Legal Notices section for additional information.