A loss suffered by a company (fire, flood, storm…) may disrupt its business and results in financial consequences, sometimes extensive.
AGIS SAS works on convincing the manager of the insured company of the need to cover operating losses that may be suffered, for two reasons:
- First, the purpose of this cover is to ensure the survival of the company, and a quick resumption of their business.
- Second, from the end of the incident causing the coverage to apply, compensation may be due and the insurers will speed up the settlement of the main loss in order to mitigate the quickly increasing compensation for operating losses.
Both reasons show the need for the operating loss cover that helps get the company back to the financial situation they would have been in, had the loss not been sustained.
After a serious disaster, the affected company must deal with a drop in business, or even a complete disruption of their production, leading to extensive financial consequences.
The Operating Loss Cover helps the company
- offset the effects of the drop in turnover
- cope with their fixed costs by covering the standing overhead costs (depreciation, taxes and duties, rent, staff salaries, loan interest…).
- bear any additional costs resulting from a loss.
This cover helps get the company back to the financial situation they would have been in, had the loss not been sustained.
To this end, the insurer, brokers and experts must find solutions to promptly resume the business.
The company may purchase an insurance cover for disruption of business resulting from the following events:
- fire, explosion, lightning;
- accidents caused by electrical devices;
- water damage;
- machinery breakdown
- storms, hail and heavy snow on roofs (only cover against storm is mandatory);
- natural disasters (mandatory when purchasing an insurance policy);
- impact of land motor vehicles;
- riots and civil commotion, vandalism;
- attacks, acts of terrorism (mandatory cover on purchase);
- fall of air navigation and spacecraft devices.
