What events trigger a Business Interruption policy to pay out?

Business Interruption Insurance typically pays out when there is any physical damage resulting in a business’s loss of income.

The specific covered events can vary depending on the insurance policy, but common events that are typically covered include:

Natural Disasters: This category includes events like earthquakes, floods, hurricanes, tornadoes, wildfires and other natural catastrophes that can damage or destroy a business's property.

Fires: Fires can cause extensive damage to a business's premises, leading to a loss of income due to the need for repairs or rebuilding.

Equipment Breakdown: This insurance can provide coverage when essential equipment or machinery malfunctions or breaks down, resulting in a business interruption and loss of income.

Theft or Vandalism: If a business is forced to close temporarily due to theft, burglary or vandalism, Business Interruption Insurance can compensate the resulting loss of income.

Water Damage: Water damage can result from various causes, including burst pipes, sewer backups, or heavy rainfall. This insurance can compensate for the losses caused by water-related incidents.

Power Outages: Extended power outages that lead to a business closure can be covered, particularly if they result from covered perils like severe weather.