Natural disasters and their implications on direct vs. indirect off-premises business income losses

[...]businesses can protect themselves by purchasing business interruption insurance, to ensure that a business's revenue stream continues during a period of interruption. Business interruption Coverage Business interruption insurance typically is defined as insurance "to protect the insur...

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Bibliographic Details
Published in:The Brief (Chicago. 1980) 2017-03, Vol.46 (3), p.30
Main Authors: MacLaren, Scott A, Maloney, Francis J. "FJ", III, Phillips, Christina M
Format: Article
Language:English
Subjects:
Analysis
Business interruption insurance
Business losses
Disaster insurance
Disasters
Economic aspects
Environmental aspects
Insurance claims
Insurance coverage
Insurance policies
Natural disaster damage
Property & casualty insurance
Risk management
State court decisions
Volcanoes
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Summary:[...]businesses can protect themselves by purchasing business interruption insurance, to ensure that a business's revenue stream continues during a period of interruption. Business interruption Coverage Business interruption insurance typically is defined as insurance "to protect the insured against losses that occur when its operations are unexpectedly interrupted, and to place it in the position it would have occupied if the interruption had not occurred. A business that suffers direct physical loss or damage due to a natural disaster itself will file a BI claim under its policy, whereas a business that loses customers or critical supplies as a consequence of physical damage to the property of others, and which itself is not physically damaged, will seek coverage under the CBI provisions of its policy. Notwithstanding such variations, the elements needed to establish a BI or CBI claim are typically uniform: (1) physical damageJ (2) to covered property (3) caused by a covered peril during the policy period (4) resulting in an actual loss of income (5) due to the "necessary suspension of operations" (6) during the period of restoration. The eruption was the only significant one to occur in the contiguous 48 U.S. states since the 1915 eruption of Lassen Peak in California.4 An eruption column rose 80,000 feet (approximately 15 miles) into the atmosphere and deposited ash in 11 U.S. states.5 At the same time, snow, ice, and several entire glaciers on the volcano melted, forming a series of large lahars (volcanic mudslides) that reached as far as the...
ISSN:0273-0995
2163-0178