How to Protect Your Business with Loss of Income Insurance

Hoffman Hanono
July 19, 2023

Business happens at the speed of life. You can’t always predict when your business operations will be interrupted by fire, weather, or theft. That’s why you need loss of income insurance. These policies protect entrepreneurs from the unexpected. Here’s how to protect your business with the loss of income insurance.

How Does Loss of Income Insurance Work?

Loss of income insurance is a unique policy that pays for continuing expenses. The exact expenses vary between policies but often include payroll, mortgage payments, and tax expenses.

This can also be important if you have to relocate to a new location — temporary or permanent. But you can also add additional options to your policy to adapt your coverage to your risks and location.

Ways to Protect Your Business with Loss of Income Insurance

Loss of income insurance can be tailored to your specific industry, location, or risk level. Depending on your provider, you can receive coverage for things like:

  • Loss of income due to a loss of utilities (water, electricity, etc.)
  • Extra expense services for businesses that operate throughout an emergency
  • Coverage if you’re forced to close due to orders from civil authorities
  • Losses due to a supplier or dependent business shutting down

The latter is an important part of business protection. What if a fire breaks out at a neighboring business? Loss of income insurance can help you replace lost income due to a disaster that didn’t even originate from your business.

Therefore, your policy will protect you from the loss of any income from any or all of these circumstances, which can be invaluable in keeping up with your mortgage payments or payroll.

Do I Need Loss of Income Insurance?

If you already have business insurance, do you need loss of income insurance? While there’s no legal reason businesses have to carry this additional policy, loss of income insurance can add an additional layer of protection for your business, employees, and customers.

Consider the varied circumstances that could affect your business or your customers. For example, what if an emergency occurs between the time your customer completes a purchase and when the product or service is delivered? A loss of income insurance can help you refund these customers without negatively impacting your cash flow.

Additionally, loss of income insurance keeps your payroll operating on time. In an age where employers struggle to attract and retain quality employees, keeping your workers paid and happy is vital. Loss of income insurance provides the means to do just that.

Obtaining Loss of Income Insurance

To receive the full benefit of loss of income insurance, you’ll need a provider that can connect you to the right policy, and assist you when it’s time to process a claim. To help protect your business from the unexpected, contact Hoffman Hanono to get a quote today.