Forced idle-time of a company in the event of property damage/loss may cause serious obstacles to company development because also during the idle-time period the company must pay utility charges, salaries to employees, repay credit liabilities etc.
The basic principle of business interruption insurance is to compensate for damage caused by downtime so that the customer would not have any financial implications after the accident and would be in the same financial position as before the accident.
The business interruption insurance of Seesam
This insurance does not cover pure financial loss, such as loss resulting from market changes (crisis in sales markets, currency risks, etc.) - these are generally the exception cases.
Basically, insurance covers business interruption risks, which are caused by:
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fire and related risks – e.g., fire, explosion, lightning;
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water and risks related thereto;
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equipment breakdown, or other unforeseen physical defects of machinery;
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sudden, unexpected physical damage to / loss of property subject to the "all risk" coverage.
Business interruption insurance is possible not only to companies engaged in production of goods but also to companies engaged in provision of services, for example:
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insurance of additional costs – it covers additional financial losses incurred by the company in case of damage to/loss of property caused in connection with relocation, rental of machinery, purchase of additional services etc. This type of insurance coverage is suitable for companies whose main activities take place in offices and is not related to manufacturing operations;
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rental income insurance – it covers rent amounts not received from tenants or lessees in the result of loss of the property. This insurance coverage is more suitable for landlords and companies that lease out space to tenants.