Business Continuation Lessons from Japan Disaster

March 8, 2011||inBusiness Insurance|business insurance

The earthquake and tsunami in Japan are impacting businesses all over the world.  An article in the Wall Street Journal on March 17, 2011 highlights the importance of protecting your business not only in the event of business interruption at your location but also in the instance that a supplier experiences a catastrophe that affects your business.

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Many businesses have purchased business interruption insurance, which covers lost profits caused by damage at your facility, such as a fire at your location shutting down production. However, if a key supplier has a fire, which prevents them from delivering materials essential to your production process, this is a circumstance not covered by a business interruption policy.  You would have no coverage unless you have also purchased contingent business interruption insurance.

Losses to your business can add up quickly if a key supplier is out of commission for an extended period of time; therefore, having this additional protection is something that manufacturers and other types of businesses should investigate.

As is common with all insurance policies certain conditions and deductibles apply to contingent business interruption insurance.  So, please contact us for additional details on how business interruption and contingent business interruption coverage can better protect your business.

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