Florida businesses are at risk of severe weather and other tragedies leading to temporary closures. While your doors may be closed for repairs, the bills to operate your business are still open. Paying bills can be difficult when you're not making money, which is why every business can benefit from business income insurance.

Business income insurance helps pay the bills when you can't. Whether you're just starting a business or reassessing your coverage, a Florida independent insurance agent can help you find adequate business insurance.

What Is Business Income Insurance?

Business income insurance is a type of Florida business insurance that pays your lost income and any continuing expenses if your business has to temporarily shut down. It works alongside your commercial property coverage.

Your business must shut down as a result of a covered event that is listed in your policy.

"Business income insurance is the most valuable property insurance you can buy for the money," explained insurance expert Paul Martin. "What it does is keeps the business alive while you’re repairing or rebuilding."

What Does Business Income Insurance Cover in Florida?

A business rarely expects to suddenly close its doors. Being surprised with a temporary shutdown can leave you in a difficult position for paying your continuing expenses.

Business income insurance provides coverage for the following:

• Lost earnings
• Employee wages
• Temporary relocation
• Lease, loan, or mortgage payments
• Tax payments
• Training costs for existing or new employees after rebuild

Covered perils listed in most business income insurance policies include:

• Wind
• Fire
• Theft
• Lightning
• Falling objects

"Some insurance is starting to cover COVID-related closures under business income coverage," explained Martin. "It's best to talk with your insurance agent, who will have the most updated information."

Natural Catastrophe Losses in the US by Peril

What Isn't Covered by Business Income Insurance in Florida?

Since your business income insurance is part of your commercial property coverage, the exclusions are the same between the two.

Business income insurance will not cover:

• Floods and earthquakes
• Acts of war or terrorism
• Routine maintenance
• Inoperable power lines
• Undocumented income
• Interruptions by civil authority

A Florida independent insurance agent can provide a full list of exclusions that are written into your policy.

How to Calculate Business Income Insurance Cost in Florida

Whatever your business, you'll select a limit that aligns with your needs when choosing your business income coverage. When calculating business income insurance, Martin says insurers use the following process. 

They consider how long the coverage will last and how much you're going to need in a worst-case scenario. Starting with this number, they drop two zeros because insurers charge per $100 of limit. They then multiply that number times the building property insurance rate. Last they consider one of the following purchasing factors:

1. Buying on a co-insurance basis
2. Buying on a maximum period of indemnity (120 days)
3. Buying on a monthly limit of indemnity

The combination of these factors determines your business income insurance rates.

Business Income vs. Extra Expense Insurance

Business income and extra expense insurance are part of the same policy. Extra expense insurance is the amount of money an insurance company agrees to pay in order for you to stay open. 

"If it makes the difference between you staying open or closing your doors, they'll pay for whatever you need to keep the doors open," explained Martin. "This is often more affordable than paying for a temporary closure for insurance companies."

Extra expense coverage is also valuable for businesses that have a more difficult time shutting down, such as banks or insurance companies. 

How a Florida Independent Insurance Agent Can Help You

A temporary closure can cost your business thousands of dollars in losses. Business income insurance helps you keep your business intact while it's being repaired. A Florida independent insurance agent is the easiest way to find an affordable business income policy.

Agents will talk with you, free of charge, about your insurance needs. They'll shop multiple carriers to find you a variety of quotes to choose from. Should you need to file a claim, they will help you through that process as well.