Four out of five businesses whose insurance arrangements we are invited to review do not have adequate Business Interruption insurance.

Business Interruption is the American term now widely used for what is otherwise known as Consequential Loss or Loss of Profits. In its simplest terms is the insurance which covers the after effects of a disaster, not the repair of the damage itself, which is separately insured.

Clients misunderstand the issue because they know they have covered the material loss itself; the effects of serious damage upon a firm's P&L Account are seldom anticipated. Damage which causes £10,000 of material loss can cause £1,000,000 loss of gross profit. The failure of insurance advisers to ask for and interpret company accounts and forecasts allows the situation to continue and puts clients at risk. The worst scenario is that a client, who had felt secure because their material damage arrangements were adequate, goes out of business. Correctly arranged Business Interruption cover could have been that company's ultimate lifeline.

Robertson-McIsaac has a long track record of arranging this cover for clients. Every business faces different commercial circumstances and we use our experience to identify what they are and precisely how they should be insured.

© Robertson-McIsaac 2005

Authorised and regulated by the Financial Services Authority.