Don’t Wait Until It’s Too Late: Contingent Business Income
Business income insurance is a crucial part of any risk management plan. It’ll protect your revenue if it’s impacted from a covered property claim, such as a fire that causes you to shut down operations for a month. In fact, a lack of income protection is why many manufacturing companies can’t re-open after a major event.
However, in today’s global marketplace your income can be severely impacted by catastrophes at facilities other than your own. It is this type of scenario that requires a close look at “contingent” business income coverage.
Just like the name implies, contingent business income insurance protects your income from events that happen at contingent locations upon which you rely to operate your business. Common contingent business income events that can be covered are:
- Your major supplier suffers a fire and is unable to provide you with needed components
- A key client of yours has a catastrophe and won’t be able to purchase from you for the next six months
- The local power utility suffers damage, causing you to be without power for several days
Contingent business income can also be tailored to specific needs. For example, a policy can be written to protect against income loss if you rely on a specialized service, such as a computer data host.
Because of the individualized needs of businesses, contingent business income coverage should be thoroughly discussed with your Assurance broker. There is no “one size fits all” policy and any unique factors of your operation should be reviewed in detail.
Basic income insurance is a standard part of any risk management plan, and contingent business income should be too. Talk to your Assurance broker today about how to protect yourself.
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