Business Interruption Insurance
Form Comparison

This page provides a comparision of the key clauses of each of the two most commonly used business interruption insurance forms; the Gross Earnings and the Profits Forms.

While the fundamental principles of the two forms are the same, the measurement of loss under the two is different. A business interruption insurance loss calculated under the Gross Earnings form essentially starts at the top of the income statement with sales and works down by deducting variable, saved or non-continuing expenses.

In contrast, the Profits Form starts at the bottom of the income statement with net profit or loss before income taxes and adds the fixed or continuing expenses to this amount.

Some of the other key differences between the forms include the coverage period (physical restoration for Gross Earnings; affected period of business for Profits); co-insurance requirements (80% versus 100%); and ordinary payroll coverage.

To enable a proper review or preparation of a business interruption insurance claim under either of these policies, or any other, contact us.