Provide four sources of Business Interruption losses and an example of each. - ANSWERi) Physical damage to business
example: Fire destroys business and customers cannot make purchases
ii) Failure of public utilities
example: Ice storm damages power lines and power cannot be restored for several
...
Provide four sources of Business Interruption losses and an example of each. - ANSWERi) Physical
damage to business
example: Fire destroys business and customers cannot make purchases
ii) Failure of public utilities
example: Ice storm damages power lines and power cannot be restored for several
weeks. This results in sales at the business to plummet
iii) Transportation related accidents
example: Railcar containing hazardous gas overturns causing evacuation of town.
As a result, of this railcar accident, sales at business cease.
iv) Physical damage to neighbouring premises
example: Your client, who is a tenant in a shopping mall, experiences drop in
sales when anchor store burns to the ground
Identify three sources of funding available to businesses when their operations are
interrupted. - ANSWERi) Reduce capital reserves
ii) Take out a bank loan
iii) Purchase adequate amounts of business interruption insurance
What is the period of indemnity provided by Gross Earnings forms? - ANSWERCoverage begins on the
date of destruction or damage and continues for time
necessary to repair or replace damaged property
What is the period of indemnity provided by Profits forms? - ANSWERCoverage begins on the date of
destruction or damage and continues until the preloss
sales have been re-established
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