Business Interruption, Business Income and Extra Expense


Under the insurance industry standard issued Property policy, as well as under specialized coverages underwritten for certain industries, Business Interruption is an essential part of the Property Package Policy.

The standard Property insurance includes coverage for Building loss, Business Personal Property; including Tenants’ Improvements; Furniture Fixtures and Equipment; Stock and Inventory; and miscellaneous property used in the business operations.

Also, an important component of the Property coverages is Business Interruption Insurance, also known as Business Income Insurance. Finally, Extra Expense coverage applies as a component of Business Interruption Insurance so that cost incurred to maintain Operations can be recovered during the Period of Restoration.

The Period of Restoration is a time that begins when a loss occurs and ends when Operations are returned to normal and Business Operations resume.

It is the combination of these concepts applied to a covered loss that gives rise to an opportunity to recover the following:

Business Interruption (Business Income) means the following:

  1. Net income that would have been earned or incurred; and
  2. Continuing normal operating expenses incurred, including payroll.

For enterprises with high overhead, such as hotels, restaurants, and law firms, the burden of Continuing Operating Expenses are significant. Lost income and expense burdens are found in retail stores, grocery stores, and other high cash flow operations.

These enterprises require Business Interruption Insurance and the proper investigation, measurement, and coverage advocacy to obtain policy benefits is my expertise.

Business Interruption Insurance loss evaluation and calculation is a specialty reserved for insurance personnel and their retained accountants. Very few, if any, company insurance adjusters are capable of properly investigating and measuring a Business Interruption loss.

At Professional Insurance Evaluations, we understand the claim, the coverage, the methods and strategy for a successful Business Interruption loss calculation. My review of the policy is essential in order to properly understand the insurance coverage applicable to the claim. We know how to conduct the proper investigation, assembling relevant supporting documents necessary to sustain a properly measured Business Interruption loss calculation.

Kevin K. Dawson, the Executive General Adjuster for Professional Insurance Evaluations, has significant expertise and insurance industry experience in the investigation, evaluation, assessment, and claim calculation of Business Interruption claims.

During his employment in the insurance industry, Kevin K. Dawson developed an expertise early in his career in commercial loss evaluation. During his tenure at Chubb Insurance, he was designated a Business Income specialist and investigated, prepared, and while employed for insurers, calculated Business Interruption loss calculations for the benefit of policyholders.

Most other adjusters in this industry rely upon forensic accountants that are beholden to their insurance company partners in the diminution and devaluation of the insured’s Business Interruption claims.

During Kevin K. Dawson’s tenure at Chubb Insurance and developing that specialty as a Business Interruption expert, he discovered conceptual and legal problems with the Business Income forms and effectively cured those deficiencies by writing the Business Interruption policy forms for Wineries and Biotech companies. As that author, Kevin K. Dawson’s analysis was essential in the development and marketing of those Business Interruption policy forms.

Professional Insurance Evaluations can initiate your claims investigation, develop your loss analysis, submit your claim under the appropriate coverage for the proper evaluation and payment by your insurance company.

It is essential that any claim presented be consistent with the policy of insurance, issued by your insurer, properly documented, calculated, and advocated within the policy coverages offered by your insurer.

Any analytical short coming in the preparation and submission of the claim will create a pretext for the denial of your claim. We will advocate for your recovery. All work is done on contingency basis.

With your cooperation and provision of documents, allow us to assemble your claim, act as your advocate, and collect sums that you are entitled to under your Property Insurance Contract with your designated insurer.

Once we have an opportunity to assemble the proper documents, we will collect your money or, if your claims are improperly denied, insure that you have access to extra contractual recovery mechanisms.

View Business Interruption Claims Notice by CA Insurance Commissioner