Business Interruption Insurance
Other Forms

This page identifies some of the other business interruption forms commonly used by businesses.

A. Extra Expense

1. The use of Extra Expense insurance has increased dramatically and today, most manuscript business interruption policies include some form of extra expense coverage, while many standard business interruption forms have it added either as an endorsement or a clause.

2. In most instances, the paramount interest of a business is the continuation of its operations. It is impossible for some businesses to continue operating during the restoration period of damaged property, while others are able to. Therefore, it is important to distinguish the type of extra expense coverage that a particular company needs when establishing its requirements.

B. Earnings Insurance - No Co-Insurance

3. Even the smallest non-manufacturing business is a candidate for business interruption insurance, as the need does not disappear because an organization is small. Because of this and the desire within the North American insurance industry for a simpler form without the often misunderstood co-insurance provisions, the Earnings Insurance – No Co-Insurance Form was developed.

4. The two main characteristics of the coverage are that it is only for non-manufacturing risks and there is no co-insurance clause.

C. Rental Income Forms

5. The Rent or Rental Value Form was developed to meet the needs of property owners who rent to others. The coverage can be written on either a Gross Earnings or Profits Form basis and is usually included as a part of the business interruption manuscript wording.

D. Contingent Business Interruption Coverages

6. Some businesses are highly dependent on other firms for the supply or sale of essential materials, services and/or parts. Contingent business interruption insurance was designed to provide coverage for such exposures. Its intent is to provide business interruption coverage for a loss incurred by an insured which was caused by the destruction or damage to property at locations which are not operated, controlled or owned by the insured.

7. The main types of contingent business interruption coverages are contributing properties (losses caused by the inability of a supplier to provide goods or services) and recipient properties (loss caused by the interruption of a business’ source of supply).

Need help in evaluating losses under these coverages?

We are available to prepare and/or review your business interruption losses and what is covered under each of these policies. Though we are based in Vancouver, Canada, we travel throughout North America in our role as specialized business interruption insurance accountants. We can be reached at 604-688-9100 to review your problem or complete the following inquiry form and one of us will call you back.