If your business has been impacted by the recent flooding in Auckland or Cyclone Gabrielle and you have bought Business Interruption insurance, you will/may be able to submit a claim for your loss of profit/revenue as a result.
The following is intended as guide to help you assess whether you have a Business Interruption claim. Please call your ICIB BROKERWEB broker for advice if you are unsure. We are here to help.
If your business has suffered property damage and you have Business Interruption cover
If the business has suffered any physical damage to the property insured or any items used by you at your premises e.g. there is damage to the building, stock, plant & equipment, furniture etc, and you have lost profit/revenue as a result, then you will be able to submit a business interruption claim.
If you have property damage then you will have, or will shortly be, submitting a Property Damage claim. When you submit the claim, please be sure to include details about how your business has been impacted by the event, how long it was/is expected to be closed as a result of the damage, and when you expect it to re-open.
We will contact you to advise what information you need to submit to make the business interruption claim, but please make sure to record all of the additional costs associated with re-opening the business as these will form part of your claim.
If your business has NOT suffered property damage but has been impacted by the flooding or cyclone
If your business has not suffered direct physical damage but has been disrupted by the flooding or the cyclone you may still
be able to make a claim for loss of revenue. Many policies will provide a limited amount of cover for loss of profit/revenue arising from damage that has not occurred at the premises. The usual extensions may include:
Denial of access/Prevention of access
Where roads are closed either physically or by order of the authorities and this has, or is, causing a loss of revenue.
Please provide us: the names of the road closures, and the approximate distance of the road closure(s) to your premises.
You cannot obtain stock or material due to damage at your suppliers’ premises, i.e. they have been flooded and cannot supply you and this impacts your business.
Your customers have suffered damage and are unable to buy from you.
Please provide us: the names and address of the suppliers or customers causing the loss.
Electricity stations, sub-stations, power lines, water works or any other supplier of utilities has suffered damage and this has impacted your business.
Please provide us: the name and location of the affected public utilities
The cover for these extensions will have limits which are detailed in your policy. These are normally limited to 10% of the gross profit/revenue sum insured you have declared. The policy will also apply a waiting period before the cover commences. The waiting period may vary but will normally be a minimum of 24 hours.
These are the most common extensions, but individual policies may include additional extensions which may also apply and have been specifically negotiated on your behalf.
Business Interruption is a complex area. We recommend you talk with your ICIB BROKERWEB broker for guidance around how your policy may respond.