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Does Business Interruption Insurance Cover Rent?

The protections that you are afforded under your business interruption insurance plan will be specific to your policy agreement. However, business interruption insurance generally does cover rent for the space where your establishment is located, according to the Insurance Information Institute (III).

In addition to rent, a business interruption insurance plan may provide coverage for:

  • Utilities that your business continues to pay for during closure
  • Revenue that your business has forfeited (and will forfeit)
  • Any business-related property that was damaged or destroyed
  • The cost of temporarily relocating or opening new avenues for business, if necessary
  • Any additional expenses related to the interruption in your business’ operations

Again, you will need to check your policy to confirm what benefits you can receive in the event of a qualifying crisis.

Business Owners Have to Pay for Many Services During a Closure

Business owners, especially those who operate small and medium-sized businesses, know that profit can never be taken for granted.

Business owners have to account for a variety of fixed costs, which, depending on their industry, may include:

  • Rent for one or more business locations
  • Utilities, such as water and electricity
  • The cost of internet connectivity
  • The cost of security, both digital and physical
  • Payroll
  • Benefits for employees

When a business is interrupted, these costs do not simply go away. Depending on the nature of your business’ closure or reduction in operations, business interruption insurance may be one means of obtaining financial relief.

Insurance Is Preferable to Other Means of Business Survival

When a business loses unsustainable amounts of money, either during normal operations or an unanticipated disruption in business, there are a few ways to keep the company afloat.

Some of these methods include:

  • Reducing employees’ salaries
  • Laying off employees
  • Taking out one or more loans from the U.S. Small Business Administration (SBA)
  • Taking out one or more personal loans to cover losses, which may require you to put up your home, car, and other property as collateral

Each of these options will cost you. Most business owners choose to avoid these steps, if possible. It is preferable to tap into any business interruption insurance plans that you have when hard times hit. These protections could keep you from paying for your business’ expenses out of pocket.

Know Your Insurance Policy

As a business owner, it is likely that you have one or more forms of insurance pertaining specifically to your business.

Many company owners have business interruption insurance, generally as part of either:

  • A business owner’s policy
  • Property and casualty insurance

You may have consciously elected to add business interruption insurance to any of these policy types, or it may have been included in either policy without you being aware. If you are facing a business interruption either because of the COVID-19-related economic slowdown or for another reason, now is the time to dive back into your policy.

Insurance policies can be daunting and difficult to understand, especially at a time when you have much on your mind. A lawyer may be able to help you understand the wording of your policy, while also helping you file a claim.

A Lawyer Can Assist You With Your Business Interruption Insurance

Many claimants elect to work with a lawyer while filing a claim. These legal professionals can provide many services that are designed to promote a smooth claims process.

A lawyer may be able to assist you by:

  • Reviewing your policy
  • Explaining the implications of the specific language in your policy
  • Consulting experts in the field of insurance and insurance law
  • Helping you file a claim
  • Taking legal action to dispute a denied claim, if necessary

Right now, your business may be at a crossroads. Even the smallest mishap can mean the difference between keeping your company viable versus ceasing operations for good. You do not have to fight for the protections offered under your business interruption insurance plan on your own.

Call Our Team at The Landau Law Group Today

We feel the pain of business owners such as yourself in this trying time, and we want to help you pursue any compensation that may help your business survive, including business interruption insurance that covers rent.

We can help you at any stage of the claims process, whether you are:

  • Just beginning to file a claim
  • Have filed a claim, but are facing pushback from the insurance company
  • Have had your claim denied
  • Have been offered a settlement that does not cover your losses

Our team seeks to help those who have been faced with injustice. You deserve the benefits outlined under your current insurance policy.

Call our team at The Landau Law Group today at (866) 703-4878 for a free consultation.