It is a well-known fact that a substantial number of businesses never fully recover after suffering a major property loss and interruption of their business operations. While there may be a reasonable recovery of the loss of physical property, there is all too frequently insufficient, if any, “time element” insurance in place to protect against the interruption to operations. So while many expenses continue during the interruption, there is inadequate, if any, insurance in place to pay these ongoing expenses and the lost profits when operations are suspended.
Today, there are few things companies whose operations encompass multiple locations won’t do to stay connected. Much attention is paid to items that support and underscore the affili- ation and interdependence of each site on the other — and ultimately on the whole.
Unfortunately, that same priority is not always given the firm’s insurance program, especially when it comes to understanding and address- ing the coverage that recognizes that inter- dependency — and how a loss at one facility can have a dramatic, unforeseen impact on the overall income of the business even though each site seems to be properly insured.
Blanket business income insurance is that coverage, and it is the subject of our feature article in this issue of Adjusting Today.
Veteran public adjuster Randy Goodman takes an informative look at the matter, using exam- ples to point out how and why this coverage is too frequently overlooked by even experienced insurance brokers, buyers and risk managers — and how it was a lifesaver to one business that had the right program in place.
Mr. Goodman’s article also includes some sound, basic information and suggestions on business income insurance, and is accompa- nied by a short piece that can help project the levels of business income insurance a firm might need.
More than interesting, this issue is must reading for anyone involved in developing or maintaining an insur- ance program aimed at adequately protecting an organization with multiple operating sites.
Sheila E. Salvatore Editor