Mitigating Business Risks with Property & Business Interruption Cover

Imagine a fire breaks out in a manufacturing warehouse. Property insurance will cover the cost of repairing the building and replacing destroyed machinery. However, what happens during the six months it takes to get the factory running again? How do you pay rent, service bank loans, and keep your core employees on payroll?

The Critical Role of Business Interruption Insurance

Business Interruption (BI) insurance is designed to protect your income stream. It covers:

• Lost Profits: The net profit you would have earned had the disaster not occurred.
• Fixed Costs: Continuous operating expenses like rent, utilities, and debt payments.
• Employee Wages: Ensuring your key workforce doesn't leave for competitors while your operations are suspended.
• Relocation Expenses: The cost of moving to and operating out of a temporary facility.

Structuring Your Policy

A key factor in BI insurance is the Indemnity Period—the duration for which the insurer will pay for lost income. This must be calculated carefully based on how long it would take to import specialized machinery, secure regulatory approvals, and rebuild facilities.

Speak to our risk specialists at Asian Mark to draft a combined Property & Business Interruption program tailored to your corporate continuity plan.