Business Interruption Insurance for established firms
Keeps the business funded while it recovers from a fire, flood or other insured damage, paying the profit you lose and the cost of staying open. Our partner's specialist brokers set indemnity periods and sums insured around how your operation really works.
- Lost gross profit paid through the recovery period
- Extra costs of working to keep customers supplied
- Extensions for suppliers, customers and loss of access
Reviewed October 2026 by the MyBusinessComparison.com editorial team
What is business interruption insurance?
Business interruption insurance pays the gross profit a business loses, and the extra costs it runs up to keep trading, when insured physical damage halts or slows its operations. It covers the period until turnover recovers, up to a limit called the indemnity period, rather than the cost of repairing the damage itself.
It is almost always sold alongside property cover, either as a section of a commercial combined policy or added to commercial property insurance. Most insurers will only pay an interruption claim if the damage behind it is covered by the property section, so the two need to be arranged together.
For firms with a single production site, long lead times on specialist machinery or premises that would take a long time to rebuild, the interruption section is often worth more than the buildings cover.
Business interruption cover at a glance
- Pays
- Lost gross profit, increased cost of working and agreed extra expenses
- Trigger
- Insured damage at your premises, or at locations named in an extension
- Key choice
- The indemnity period: how long the policy pays while you recover
- Sum insured basis
- Insurable gross profit for the full indemnity period, not the accounting figure
- Bought with
- Property cover, usually from the same insurer
- Common add-ons
- Supplier, customer, utility and denial of access extensions
What does business interruption insurance pay for?
The core cover is lost gross profit, but most of the value sits in the extensions. Each appears on the schedule with its own limit, and some are only included if you ask.
Loss of gross profit
The shortfall in turnover caused by the damage, less the costs you no longer pay, such as raw materials you stop buying. It is measured against what the business would have earned had nothing happened.
Increased cost of working
Spending that keeps the fall in turnover down: temporary premises, overtime, hired machinery, outsourced production or express delivery to keep key accounts supplied.
Wages and payroll
Many firms insure payroll inside gross profit so skilled staff stay paid and do not leave while the site is rebuilt. Some policies offer a separate payroll section on a different basis.
Suppliers and customers
Interruption caused by damage at a supplier's or customer's premises. Limits are often modest unless the key businesses are named and assessed by the insurer.
Denial of access
Loss when police or local authorities close the area around your site after an incident nearby, even though your own premises are not damaged.
Utilities failure
Interruption caused by a loss of electricity, gas, water or telecoms supply at the terminal or substation feeding your site, subject to the terms agreed.
Book debts
Money you cannot collect because records of what customers owe were destroyed. Usually a separate section or extension; trade credit, which pays when a customer cannot pay, is a different policy.
Read more about trade credit insurance
Rent receivable
For landlords and firms that sublet, the rent lost while tenants cannot occupy damaged space.
Read more about commercial landlord insurance
Claim preparation costs
Fees from your accountants for producing the figures the insurer needs to settle the claim, usually up to a stated limit.
Related covers that close the gaps
- Cyber insurance: pays lost income when systems go down after an attack, which property based interruption cover does not
- Terrorism cover: insures interruption that follows a terrorist attack, which standard sections normally exclude
- Key person protection: covers the loss of profit when a vital individual dies or falls seriously ill
- Event and contingency cover: for income tied to a single show, conference or season rather than premises
Which businesses need business interruption cover?
Any firm that would keep paying overheads while unable to trade. The exposure is sharpest where recovery depends on one site, one process or one supplier.
Not sure how long recovery would take? A broker can help you model it. See how cover fits your sector in insurance by industry.
- Manufacturers: one production line or a specialist machine can take months to replace, while customers look elsewhere
- Engineering firms: workshops with bespoke tooling, test rigs and long order books to protect
- Wholesalers and distributors: a single distribution centre handles every order, and losing it stops the supply chain
- Warehouse operators: storage contracts and fee income stop when racking and stock are destroyed
- Hotels, pubs and restaurant groups: bookings, events and covers lost while a kitchen or bedroom wing is out of use
- Retail chains: shop closures during refits after a fire, flood or escape of water
- Leisure venues: membership and ticket income at gyms, attractions and venues that cannot open
- Clinics and care providers: treatment income and contracts at risk when a clinic or care home has to close
- Commercial landlords: rent lost while units are repaired and tenants are unable to occupy them
- Farms and food producers: processing, storage and grain drying that a fire can stop in the middle of a season
- Technology firms: server rooms and hardware whose loss halts service to clients, alongside cyber cover for non-damage outages
- Professional firms: fee income protected while offices are reinstated and staff are relocated
How much does business interruption insurance cost?
Premiums are worked out from the gross profit you insure and how badly a loss could hurt it. These are the points underwriters weigh most.
Insured gross profit
The bigger the figure you insure, the more premium, but cutting it to save money risks a reduced settlement if a claim shows it was too low.
Length of indemnity period
Longer periods cost more, yet a period that ends before trading has recovered leaves the tail of the loss uninsured.
Fire and property risk
The same features that rate the property section, from building construction to sprinklers, decide how likely a serious interruption is.
Speed of recovery
Spare capacity at another site, standby machinery and a tested continuity plan all shorten a loss and are viewed favourably.
Dependencies and extensions
Large limits for suppliers, customers and utilities add premium, especially where one supplier provides most of your materials.
Loss record
Underwriters want to know about previous fires, floods and interruption claims, and what the business did to stop them happening again.
What business interruption insurance does not cover
Many disputes over interruption claims come back to these limits, so they are worth checking before renewal.
- Loss of income where nothing has been physically damaged, unless a specific extension such as denial of access applies
- Damage that is not insured under the property section, because cover depends on a valid property claim
- Pandemics and most disease outbreaks, which are now excluded or tightly limited by many insurers
- Ransomware, hacking and IT outages that damage nothing physical, a gap filled by cyber insurance
- Lost profit after the indemnity period ends, even if turnover has not yet recovered
- Falls in demand, lost contracts or price changes that have nothing to do with the damage
- Problems at suppliers or customers beyond the limit of the relevant extension
- Interruption caused by terrorism, unless terrorism insurance has been added
Business interruption or property insurance: what is the difference?
The two work as a pair after the same incident, but they pay for very different things.
| Feature | Business interruption | Property cover |
|---|---|---|
| What it pays for | Lost gross profit and extra costs of trading | Repair or rebuild of buildings, contents and stock |
| How the figure is set | Gross profit across the indemnity period | Rebuild cost and replacement values |
| How long it responds | Until trading recovers, up to the indemnity period | Until the damage is repaired or replaced |
| Main risk if set wrong | A short period or low profit figure cuts the claim | A low sum insured cuts the claim |
| Can it stand alone? | Rarely, it normally relies on the property section | Yes, but leaves income unprotected |
How to arrange business interruption insurance
Interruption cover is only as good as the figures behind it. These steps get them right.
Work out insurable gross profit
Start from turnover and take off the costs that would stop after a loss, using the insurer's definition rather than your accounts. Your accountant can help.
Model a worst case recovery
Think through planning delays, rebuild time, machinery lead times and how long customers would wait, then choose a period that covers all of it.
Map what you depend on
List key suppliers, key customers, utilities and access routes, and decide which need a named extension.
Review your continuity plan
Evidence of spare capacity, backup sites or reciprocal arrangements helps underwriters and speeds any claim.
Compare the full section
Check the basis of cover, the period, each extension limit and whether a declaration linked basis is offered to reduce underinsurance risk.
Get your figures checked
Share your gross profit, sites and key dependencies and a broker will build and compare interruption cover for you.
Compare quotesBusiness interruption insurance FAQs
How much does business interruption insurance cost?
The premium depends on the gross profit insured, the indemnity period, how exposed the premises are to fire and flood, and how quickly you could recover. Extension limits for suppliers and customers also add cost. A broker can show the premium for different periods side by side.
How long should my indemnity period be?
Long enough for the business to return to its normal level of trading, not just for the building to be repaired. Many firms find that twelve months is too short once planning, rebuild, machinery delivery and winning back customers are included, so longer periods are common.
What counts as gross profit for business interruption?
Insurers define it as turnover less the costs that would stop if trading stopped, usually purchases and similar variable costs. It is often higher than the gross profit in your accounts, and using the accounts figure is a common cause of underinsurance. An accountant can calculate it on the insurer's basis.
Can I buy business interruption insurance on its own?
Rarely. Insurers normally require the property damage behind the claim to be insured too, so interruption cover is bought as part of a property or commercial combined policy. Standalone interruption cover is usually limited to specialist situations.
Does business interruption cover a pandemic?
Most policies now exclude pandemics or limit disease cover to a small sum and named illnesses. If disease related closure is a real risk for your business, ask the broker exactly what the policy says and whether any extension is available.
Am I covered if a fire at a supplier stops my production?
Only if the policy includes a suppliers extension and the loss falls within its limit. Unnamed supplier cover tends to be modest. Naming your critical suppliers, and giving the insurer details of them, usually allows a higher limit.
Will business interruption insurance pay staff wages?
Usually, yes. Wages are normally included in gross profit, so continuing payroll is covered within the main sum insured. Some firms choose a separate payroll section on a different basis, which is worth discussing if labour is a large share of costs.
Does it cover downtime after a cyber attack?
Not normally. Interruption cover on a property policy responds to physical damage. A ransomware attack or system outage with no physical damage needs a cyber policy with its own business interruption section.
How do I get a business interruption insurance quote?
Send your details through this page and a specialist broker will pick up the figures with you. Your latest accounts, a breakdown of variable costs, a list of sites and key suppliers, your claims history and any continuity plan give insurers the full picture.
Protect the profit your business depends on
Get business interruption cover set around a realistic recovery period, arranged by a specialist broker.