Business Interruption Insurance
Perth, Sydney, Melbourne, Brisbane & Canberra

Business interruption should be considered through the way the business earns income and the steps needed to recover after a relevant event. Identify the premises, machinery, systems and suppliers on which trading depends. Then map the practical sequence from damage assessment to repair, testing, reopening and return of customers. The time needed to replace an asset may be only one part of that sequence. A business with specialist equipment or seasonal demand can have a different recovery pattern from one able to move quickly into temporary premises, even when the physical loss appears similar.

Ask what event must occur for the proposed interruption section to respond. A property-related arrangement, cyber policy and specialist dependency extension may use different triggers and definitions. Do not assume that any fall in revenue, supplier delay or utility outage is included. Explain dependencies on customers, neighbouring premises and external service providers so the broker can discuss relevant options and limitations. Distinguish damage to your own property from an event elsewhere that prevents trading. The insurance review should identify the specific situations under consideration and the wording needed to assess them, rather than use interruption as a general label for all business setbacks.

Bring financial statements, management accounts and information about seasonal trading, growth and significant contracts. Ask how the policy defines the financial measure being insured, which expenses are treated in the calculation and how the selected sum should be established. Insurance definitions of gross profit or revenue should be checked carefully against the business’s accounts rather than assumed to have the same meaning. Involve the appropriate accountant or adviser where needed. Record the assumptions used for the selected indemnity period and values so they can be revisited when the business changes or replacement lead times move.

Review additional expense and other relevant provisions in detail. Ask how temporary premises, outsourced production, extra transport or other recovery costs would be considered and what conditions apply. Explain practical alternatives, including their capacity and cost, rather than assuming a substitute is readily available. Keep leases, supplier agreements and equipment specifications that influence the recovery timetable. If cover is being considered for a dependency away from your premises, identify the location or service accurately and clarify any applicable limits. The proposed arrangement should follow the business’s actual operating and financial model, with uncertainties made visible before a loss occurs.

After an event interrupts operations, preserve the timeline and the evidence of what prevented normal trading. Record affected activities, periods of closure or reduced capacity and the decisions made to restore service. Keep cancelled orders, customer communications and relevant financial information organised. Contact the insurer or broker about the claim process and proposed recovery expenditure. Separate ordinary business changes from the effects attributed to the event, and retain supporting explanations. An interruption claim may require detailed assessment, so an early estimate should not be presented as an agreed settlement or a guarantee that every lost sale will be compensated.

At renewal, revisit the recovery period and financial values using current circumstances. Expansion, new products, a larger contract or dependence on a single supplier can change the assumptions. Check whether alternative premises, equipment and skilled people would actually be available after a wider regional event. Consider how accounting and order records would be accessed if the main systems failed. Ask the broker to explain relevant triggers, waiting periods, sub-limits and exclusions under the proposed wording. A realistic review supports financial resilience while keeping clear that insurance responds to defined events and calculations, rather than every cause of reduced profitability.