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The unthinkable has just happened.  Your business has burned to the ground.  Yet you were prudent and smart:  You insured your business to value.  Once the insurance company settles, you'll be able to rebuild and restock, putting everything back as it was.  In a year or so, you'll be back in business.

Wait a minute.  A year?  What company can afford to be out of business an entire year?  You're going to have to scramble to find a temporary location, buy equipment and supplies, continue to pay your employees, and absorb extra shipping costs.  So it's on to your banker for a loan. . .or is there another solution? 

You bet there is!  It's called Time Element Coverage, known as Business Income and Extra Expense.  Let's say at your temporary location you're confined by space to make the quantity of product you normally produce; instead of making $100,000 per month, you're only generating $50,000 revenue a month.  Business Income will then step in to pay the extra $50,000 you normally would have made.  Extra Expense will pay for expenses you suddenly incur, such as rent, perhaps payroll for additional temporary employees, your shipping costs for new equipment and supplies, and installation costs of the equipment. 

If you have a Business Owners Policy (BOP), chances are excellent this vital coverage is already provided.  If you have a Commercial Property (CP)  policy, you have to buy a separate Time Element policy.  (Sometimes limited Time Element Coverage is endorsed to a CP policy for an additional cost.)  If you're not sure you have this protection for your business, check your policy--or call your agent.  And we hope that agent is us!

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