What Are The Key Features of Loss or Profit Policy

Key Features of Loss of Profit Policy

1. Coverage

The last thing you want to think about is how your business will survive after a fire, flood, or other perils destroys it. You’ll need to deal with the consequences not only of rebuilding and repairing damaged assets but also of losing out on profits while your company operates in downtime. The loss can be devastating for any company when their livelihood depends on the successful operation of their business. However, with the right coverage through a Loss of Profit Policy, one can have peace of mind knowing that losses incurred due to such perils will be covered by insurance! The best way to find out what your options are is by understanding the different types of benefits available, which are outlined below.

• Deficit of Net Trading Profit
• Loss of Wages
• Standing Charges
• Increased Working Cost
• Fees of an Auditor

2. Extensions

If you’re looking to purchase a Loss of Profit Policy, it’s important to understand the different extensions that are available. With the standard Loss of Profit plan, three major Extensions are offered:

• Inadvertent failure of public electricity, water supply, or gas;
• Damage to the customer’s premises as a result of hazards covered by the Fire Policy; and
• Damage to the Supplier’s premises as a result of hazards covered by the Fire Policy

Extensions are a great way of increasing coverage of insurance by adding a small amount to the annual premium.

General Exclusions

It is important to understand the general exclusions of an insurance plan at the time of purchasing one. It helps reduce the chances of getting claims rejected. The general exclusions to the Loss of Profit policy are:

• Deficit of Gross Profit
• Difference between Stock Value before fire and replacement
• After-fire degradation of surviving stock
• Goodwill loss
• Claims of third-parties