Locations: Florham Park, NJ and Marysville, PA

Loss of Business Income or Loss of Rental Income Insurance for Businesses in New Jersey, NJ

When businesses suffer a loss such as a fire or wind damage purchasing the proper insurance to cover that loss is important.  Many business foolishly cut costs and don’t purchase the proper coverage for the loss of business income.  This type of insurance is known by many names such as, BUSINESS INTERRUPTION INSURANCE, TIME ELEMENT COVERAGE, LOSS OF BUSINESS INCOME INSURANCE.

Business Income Coverage provides income for a length of time.  The income must cover loss of profits, continued expenses and extra expenses.  Under time element, the extent of the loss is directly related to the passage of time.

Certain events must occur for coverage to trigger:

  • There must be direct damage
  • The damage must have occurred because of a covered loss
  • The damage must occur at the described premises
  • Business operations must have to be suspended or must incur extra expense
  • There must be actual  financial loss during the period of restoration

BUSINESS INTERRUPTION insurance provides coverage when the premises is unusable.  The insurance carrier will pay for what the business would have earned if no loss had occurred.  The insured must prove the amount based on past records and profit forecasts.

The insured sets the limit of insurance by taking into account the maximum possible shutdown time.

EXTRA EXPENSE coverage provides payment so that a business can keep a location open.  If the business can stay open by renting a piece of equipment to continue production rather than shutting down, then payment will be provided.

A similar coverage is know as LOSS OF RENTS coverage.  When a person or business owns a building that is rented to others coverage is needed if a loss occurs and the tenant no longer occupies the building.  The landlord needs income from the Loss of Rents.

A type of insurance that schools need is LOSS OF TUITION.  If a school suffers a covered loss and will be temporarily unable to occupy the building, then the school need coverage from the loss of tuition so that the school may continue to pay the teachers salary and other expenses.

If your business is in New Jersey, please call the Franchino Agency if you are interested in learning more about this important coverage.