Consider the impact on your business if your equipment fails. Your operations are interrupted right away. If you don’t have backup equipment, you may need to find alternate facilities or rent equipment which will increase your production costs. Keeping your customers waiting can be costly and orders may be cancelled. Not only will you suffer loss of revenue, you are risking damage to your good reputation.

Business interruption coverage for auto parts will put cash in your hand to keep your business alive during a crisis situation.

What Does Business Interruption Insurance Cover?

Managing risk is an essential part of every business. Broadly business interruption insurance is designed to protect loss of income resulting from damage, or destruction to property following an insured and unexpected event like a fire. Specifically, business interruption coverage for auto parts protects against breakdowns caused by power surges, motor burnout, boiler malfunction and operator error and can pay for:

• The cost to repair or replace the damaged equipment;
• Costs for time and labor to repair or replace the equipment;
• Business income losses when a covered breakdown causes a partial or total business interruption;
• Other expenses incurred to limit loss or speed restoration;
• The cost to replace spoiled stock or materials.

While property insurance covers the cost of replacing your building equipment or materials in unforeseen circumstances, business interruption insurance for auto parts gets you up and running again in the shortest time possible. Coverage begins at the time of loss and continues until you are able to smoothly operate your business again.

Don’t Let Your Business be Interrupted

As a business owner there are steps you can take to prepare for business interruption by taking the following actions:

• Understanding the financial impact if an equipment breakdown happens;
• Having a business continuity plan in place;
• Understanding the key areas in your manufacturing or supply chain;
• Working with a broker to make sure policy wording, extensions and limits are correct;
• Identifying all potential areas of loss and documenting them post-loss.

 To determine the amounts and limits of coverage, it’s important to look beyond the face value of the equipment itself and consider all the situations that could occur, including asking yourself these questions:

• What if damage occurs to other property as a result of your equipment breakdown?
• What if parts for the damaged equipment are not readily available?

According to the Insurance Bureau of Canada coverage for business interruption depends on the exact nature of your business model. When considering this type of insurance, some things to keep in mind:

Talk to your accountant about the effects of an interruption to your business;

• Ask questions and state your needs clearly about what kind of coverage works best for you;
• Get opinions from others that operate in the same industry;
• Review business interruption coverage options with your insurance representative.

Each day your business doesn’t operate is another day of lost revenue. Business interruption coverage for auto parts will help you get back up and running as quickly as possible. Ensure your business has the proper protection it needs by speaking with a broker specializing in business interruption coverage for auto parts today.