Last time we talked about the need to insure the property you own and use to operate your business but you're not in business to own property. The reason you are in business is to make money! Yes making money for yourself and your shareholders.
In business "Time is Truly Money" because anytime your business is disrupted or you are not able to operate for any period of time, for whatever reason you loss money.
So, what happens if for whatever reasons you cannot operate your business? Well over the last nine months the businesspersons near the straw market painfully realize the value of time when operating a business. They now realize that you not only can loss your property but the income that is generated by that property. They also realize now that although the business and income may have been loss that certain expenses continue. They still have to repay bank loan that may have help in providing the infrastructure and inventory that was used for their businesses.
Therefore, whatever you do, you must insure that no matter what happens that you are able not only to continue your business but also continue the income and profits generated by your business.
No matter what type of business you operate straw vendor, hair braider, restaurateur, accountant, lawyer, fund manager, or retailer; you must insure your business' lifeblood. Your income, and profits. The way to do this is by purchasing Business Interruption insurance.
Business Interruption Insurance pays for the income your company will lose if you have to move from your regular place of operation because of a fire, or some other type of loss that makes it impossible for you to work there as well as offset the expense associated with the move.
You need Business Interruption Insurance if you want to be able to continue running your company and paying your employees even though you can't use your regular space.
If there is a fire or a water damage problem, and you cannot work there for a month while it is being repaired, you won't make money while you are in the process of looking for a substitute location, leasing temporary equipment, or trying to restore your records. In addition, you'll be spending more money to get things running again than you normally would have to spend. You might have to temporarily move and pay a second rent in order to continue your business while your space is being repaired.
Business Interruption insurance covers the profits you would have earned had the disaster not occurred. The policy also covers operating expenses that continue (like payroll) even though business activities have come to a temporary halt.
This is an important protection. It may help your business recover from a serious event and provide you with income while this is happening. For example, if your premises were seriously damaged by fire, you probably wouldn't be able to operate as usual for some time.
While reconstruction is being done, this policy helps you survive and get re-established.
Many business persons near the straw market wish they had heard of this kind of insurance because if they had the last nine months would not have been so painful for them and most would be back in business or well on their way with not as much worry as they are currently experiencing.
Glenn S. Ferguson, FLMI, HIA, founded Comprehensive Insurance Agents & Brokers & Comprehensive Consulting to assists both large, multi-national corporations, as well as smaller family owned businesses with their benefit decision-making.
Glenn has been helping individuals and businesses in the Bahamas with their insurance needs for the last 18 years.
He is a Fellow, Life Management Institute (FLMI); Associate of The Health Insurance Association of America (HIA) and a licensed insurance broker.
