Is Massachusetts Business Interruption Coverage Important?

Business interruption and/or supply chain risks head the list of companies’ top risk concerns. With increasing issues related to cyber risk, as evidenced by the recent costly security data breach at retailer Target, companies are scrambling to find solutions to these serious problems. Other catastrophes, such as the Boston Marathon bombing are also cause for alarm, since incidents of this nature will likely contribute to businesses being forced to close their doors, often long-term, or permanently.

As a business owner, you need business interruption insurance in Massachusetts to help restore your business when it becomes affected by any of the above-mentioned issues. The list of events that can force a company to close its doors is long and growing:

  1. Fires and explosions
  2. Changes in legislation or regulation
  3. Market stagnation or decline
  4. Loss of reputation or brand value
  5. Intensified competition
  6. Cyber crime
  7. Information technology failures or espionage;
  8. Theft, fraud or corruption, and
  9. Quality deficiencies or serial defects

Your business may also be at risk when related businesses are affected by disaster. For example, an explosion at your website host’s server could take your site down, rendering you inoperable until they are back up and running, or a key supplier may be unable to deliver goods if they experience serious damage due to a major storm. These events can be financially devastating even though your facility may be undamaged. Many insurers can provide additional insurance that covers your lost profits in these disaster scenarios.

Getting reimbursed after a covered loss

Consider saving your records electronically off-premises or storing printed copies elsewhere, so you’ll still be able to prove your losses even if your main facility is destroyed. That way, you’ll be able to furnish your insurer with documentation of your lost profits, provided you have business interruption insurance in Massachusetts.

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