Business interruption
Covers loss of earnings arising as a consequence of insured property damage.
Why this matters
After a kitchen fire, a restaurant is easily closed for several months – property insurance replaces the cooker and the fittings, but not the turnover missing during that time. Rent, salaries, leasing instalments and loans carry on unchanged in the meantime. It is exactly this gap between zero income and full fixed costs that tips healthy businesses off balance, not the property damage itself. And anyone underestimating the rebuilding time often only finds out in the emergency: official requirements, delivery times and tradesmen’s schedules quickly turn a planned three months into a whole year.
This cover is especially important for businesses with high fixed costs, a single location or regular customers who drift to the competition during a longer closure – catering, manufacturing, retail or practices with expensive infrastructure, for example. In Switzerland, business interruption insurance is voluntary and is usually taken out as a supplement to property insurance; without that underlying cover it is generally not available. The business pays the premium, which is based on the insured gross profit – that is, turnover minus turnover-related costs.
What you get out of it
If your business grinds to a halt, salaries and rent still keep running — insured.
Loss of revenue after fire or water damage is covered.
You can bridge months, not just weeks.
What we take care of for you
- Calculating the insured gross profit
- Setting the right indemnity period (12, 18 or 24 months)
- Coordination with your property insurance
- Support with settling your loss-of-revenue claim
The advice is free for you — we are remunerated by the insurance companies through brokerage commissions and will disclose these on request.
Tips from our consultations
What we tell our clients time and again – free of charge, even before the first meeting.
The indemnity period is the maximum time for which lost earnings are compensated. Twelve months sounds long but is often not enough: the building permit, reconstruction and winning back your customers together usually take longer. A longer indemnity period costs comparatively little extra premium.
The sum insured should rest on current figures, not on the accounts from three years ago. As your turnover grows, so does the gap in an emergency. Take the number out each year with your annual accounts and adjust the policy.
Your business can also come to a standstill without any fire on your own premises – for instance if your most important supplier or your only major customer fails. Such contingent losses can be included. Check which partners your turnover really depends on.
Temporary replacement premises, hired machines or express deliveries keep the business running but cost extra. A good policy covers not only the lost profit but also these additional loss-mitigation costs – often the difference between bridging the gap and closing down.