A Fire and Perils policy (FAP) provides coverage with respect to physical damage resulting from an insured peril, i.e. hurricane, earthquake, fire etc. This will facilitate the replacement, repair or rebuilding of insured property following a loss. As a result, a business that is properly insured, will be provided with the funds necessary to get the business back into operation after the loss. There are, however, a number of other areas of financial loss which are not covered by the FAP policy, and which are frequently overlooked.

For example, it would be desirable to maintain some or all of the business’ employees. There may be standing charges which the business will still be obliged to cover, such as:

• Rent or Mortgage
• Advertising
• Property or other taxes (e.g. work permit fees)
• Directors Fees
• Utility Costs

and such other costs which continue to be incurred even though the business is not operating.

In addition, very dear to shareholders’ hearts is the Profit which would have been made during the period in which the business is not operating.

All of the above can be covered under a Business Interruption (BI) policy.