Insurance for Contract Works
“There have been significant reductions in the numbers and rates of injuries and fatalities in this industry over the last ten years or more. Nevertheless, the construction industry remains a high-risk industry.”
Safe Work Australia, 2015
What is Contract Insurance?
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It’s estimated that natural disasters cost Australia $11 billion on average each year.
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The top two risks to businesses around the world are extreme weather events and natural disasters.
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While most companies insure their building and contents against disasters like fire, theft and storms, many neglect to insure for the interruption to their business caused by these events.
What Usually Isn't Covered?
Exclusions, the excess you need to pay and limits of liability can vary greatly depending on your insurer.
In order to claim under a business interruption policy, the loss has to arise from damage to property (buildings, stock and contents) which was insured and the damage to property has to be claimable under that policy.
Business interruption insurance is subject to the same exclusions as those in the policy covering buildings, stock and contents.
Who Can It Cover?
Business interruption insurance can cover the loss of any sales you would have made while your business is out of action – plus any extra costs you incur to stay open.
Depending upon the policy, business interruption insurance can cover:
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Revenue/Income
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Fixed Costs
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Temporary Relocation
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Extra Expenses
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Civil Authority Ingress/Egress
Case Study
Linda is the owner of a small office supplies business – with eight staff on the payroll and numerous suppliers.
Late one night, the restaurant next door catches fire and it spreads to her business premises – destroying the property along with the stock and IT systems. She’s unable to open the shop for weeks while the building is being repaired.
Because the business isn’t operating, she’s not making any money – meanwhile the bills are piling up. But with business interruption insurance, Linda banks an insurance payment – maintaining her cash flow at pre- interruption level.
Linda can continue paying her staff their regular wages, so they keep their jobs, and rents a temporary location so the store can keep running.