Business Interruption Insurance

Q: Can I pay my premiums by the month?

Yes. First Peoples Insurance can arrange monthly premium funding for many insurance policies through approved premium funding providers. For commercial insurance policies, the interest charged on a premium funding loan may be tax deductible, depending on your circumstances. Tax treatment differs for personal insurance products and may not be deductible. You should seek advice from your accountant or tax adviser regarding the tax implications of any premium funding arrangement.

Business Interruption Insurance is designed to protect the cash flow of a business following a major loss to insured property. It covers the loss of revenue a business would have normally generated. Business interruption also covers the ongoing fixed costs.

Why is this cover important?

Too often people in business insure their business premises, contents and stock against the material damage risks of fire, explosion and other perils, without giving thought to business interruption insurance and the other problems that could arise.

When a business experiences a major loss it can take months or even years to get your business back on track.

Business interruption provides the revenue a business would have normally generated. Could your business survive with zero income for a month, several months or even a year?

Production is disrupted.

Delays in rebuilding and replacement of plant can drain capital.

Income falls drastically.

Lost orders and customers may never be recouped.

Redundancy and other payments may have to be made to employees who lose their jobs.

Recruiting and training new staff can delay recovery.

Policy cover can include

When you consider the potential negative impact a catastrophe could have on your business, it puts Business Interruption Insurance into perspective, making sure your business becomes viable again. The policies available through First Peoples Insurance can cover:

Loss of Gross Profit

The profit your business would have earned.

Business Expenses

Ongoing expenses like payroll, financing and other fixed costs such as rent or utilities.

Financial Loss

Revenue earning operations including your supply chain.

Bills and Utilities

Interruption caused by service providers including electricity, water and gas.

Continuation of Business

Additional increased costs that may be incurred in an effort to return to normal business operations such as hiring equipment or outsourcing activities.

Relocation Costs

Relocation costs for moving to, and operating from, a temporary location.

First Peoples Insurance is a 100% Aboriginal-owned, full-service insurance broker, not a product seller. We partner with you to understand your risks and design tailored insurance brokering solutions that evolve with your needs.

We have access to a large range of quality insurers and policies to ensure you obtain the best possible coverage.

Our claims team has years of experience and expertise in successfully managing complex and difficult claims.

Frequently Asked Questions for Business Interruption Insurance

Leave the hard work up to us. We can help you work out your business interruption figures to avoid any underinsurance. We help tailor a cover to suit your needs.

Yes. First Peoples Insurance can arrange monthly premium funding for many insurance policies through approved premium funding providers.

For commercial insurance policies, the interest charged on a premium funding loan may be tax deductible, depending on your circumstances. Tax treatment differs for personal insurance products and may not be deductible.

You should seek advice from your accountant or tax adviser regarding the tax implications of any premium funding arrangement.

When your business suffers an interruption to trading, the indemnity period is the maximum time period you can claim for.

However, you must take into account that the indemnity period represents not just a period of time that it takes for your business property to be restored. It also reflects the time it takes for your business to be operating at the same revenue prior to the loss.

This cover allows your business to pay increased costs to maintain the business or service during the time of loss. These costs might include employing additional staff, hiring in equipment or even temporary relocation costs.

Also known as the “Average” or Co-Insurance” Clause, Underinsurance is the result of nominating a value for an asset which is too low to actually replace it in the event it is lost or damaged.

Certain cover sections (Fire, Business Interruption – Income, and Electronic Equipment) contain the Underinsurance clause. It is important to review the level of cover you have declared, as if the amount you have declared is too low, the insurer can apply a formula which limits their settlement to you for that loss. This can occur if you have declared less than 80% of the actual value of the risk/asset.

Many businesses unknowingly under-insure as they apply heavy depreciation to their assets or simply forget to include certain assets into their calculations.

As your Adviser, you will always contact First Peoples Insurance in the first instance and we will guide you through the claims process as this can vary from insurer to insurer.