Business Overhead Expense: How to be Prepared for Business Interruption

As a business owner, you know that even a short interruption in your operations can be costly. Business interruption insurance is designed to help you manage these costs by providing coverage for lost income and expenses during a period of interruption. However, there are some costs that business interruption insurance won’t cover, and that’s where Business Overhead Expense (BOE) insurance comes in.

BOE insurance is a type of insurance that provides coverage for the fixed expenses of a business in the event that the owner or a key employee becomes disabled and unable to work. These fixed expenses may include rent, utilities, salaries, and other expenses that are necessary to keep the business running.

While business interruption insurance covers lost income and expenses, it doesn’t cover fixed expenses. This means that if you or a key employee becomes disabled and unable to work, you may still be responsible for paying these fixed expenses, even if your business is not generating any income.

BOE insurance can help bridge this gap by providing coverage for these fixed expenses while you or a key employee is unable to work due to disability. This can help ensure that your business continues to operate and that you don’t have to dip into your personal savings to cover these expenses.

In addition to providing coverage for fixed expenses, BOE insurance can also help cover the costs associated with finding a replacement for the disabled owner or key employee. This may include advertising for the position, conducting interviews, and training the new employee.

BOE insurance is a type of disability insurance for businesses. Disability insurance is designed to provide income replacement to individuals who are unable to work due to an injury or illness. BOE insurance extends this coverage to cover the fixed expenses of a business, rather than a single person.

BOE insurance is an important way for businesses to protect themselves against the financial impact of a disability. Should you have any questions in relation to BOE insurance, you may click here to reach out to our Professional Insurance team.