Most companies have business insurance to cover loss due to physical damage, and many will likely file their claims for any loss in sales provided they have business interruption coverage as part of their NJ business insurance. Companies that suffer losses due to machine breakdown, electrical outages, or for whatever reason, may seek compensation from their insurer. This includes suppliers that were affected by any shut down of a company they engage in business dealings.

Business Interruption insurance comes into play after a company loses business for typically 72 hours or longer, and provisions are partly determined by how long it takes these businesses to resume normal operations. The biggest risks are perhaps to smaller companies as they often lack the resources and can’t survive days or months of lost income.

Severe work stoppages require filing claims

While many businesses have insurance against direct losses, fewer have policies to cover loss of income when their operations are disrupted by a supplier’s unfortunate situation. Some businesses having insurance may decide against filing a claim because of the possibility their rates will go up. But the mounting losses may be more than they can afford.

For companies that do file claims, proving how much business they lost can be a difficult chore. In many cases it is not really possible to know how much business was actually lost, one can merely estimate or guess. They may want to base their claim on routine income earned for the period of time business has been interrupted.

How to go about filing a claim

When filing a claim with your nj business insurance rep, give notice by contacting him or her as soon as possible. Document any damage by taking pictures of the premises from several different angles. Also present any pictures showing the building before any damage occurred, if possible.

If the business was forced to stop operating due to a collapsed building or downed power lines, document that as well. As a way of proving lost income, an owner of a restaurant may have records of canceled reservations, which they can document. You can show records of income over the same period in the previous year, if possible, as a comparison.

Don’t delay filing your claim, since some of the time limits for filing a claim are often quite stringent.