Great question — the duration of Business Interruption Insurance (BI) is one of the most important (and often misunderstood) parts of the policy. Let’s break it down clearly:
⏳ How Long Does Business Interruption Insurance Last?
✅ Coverage Period = “Period of Restoration”
This is the time during which your business interruption insurance will pay for lost income and covered expenses.
📆 Typical Duration:
- Most BI policies cover up to 12 months of lost income.
- Some insurers offer extended options of 18 to 24 months, depending on the business and the insurer.
- There’s also a waiting period (usually 48–72 hours) before coverage begins.
🔄 What Triggers the Start and End?
| Starts When | Physical damage occurs and interrupts your operations (after the waiting period). |
|---|---|
| Ends When | The property is repaired or business resumes to normal operations — even if you’re not back to full profitability. |
💡 Important: The end of coverage is not based on when your income recovers, but on when your property could reasonably be restored.
⏰ Extended Business Interruption (EBI)
This is an optional add-on that extends coverage beyond the restoration period, for businesses that don’t bounce back immediately after reopening.
EBI may cover:
- Lost income during the slow ramp-up back to full operations
- Delays in customer return or order volume
🔍 Example Scenario
🔥 Your café is damaged by fire and closes for 3 months. Repairs take 90 days.
During this time, you lose $75,000 in income and pay $15,000 in fixed expenses.BI Coverage kicks in after the 72-hour waiting period and lasts until repairs are complete.
You reopen, but business is slow for another 2 months — unless you have Extended BI, those losses aren’t covered.
📝 Pro Tips
- Know your “period of restoration” — and how long it would realistically take to rebuild or reopen.
- Add Extended BI if your business would take longer to regain full revenue post-reopening (common for retail, restaurants, and hospitality).
- Document delays — supply chain issues or permit delays can sometimes be used to justify longer restoration periods.
Would you like a custom checklist to estimate your restoration time or help you ask the right questions before renewing your policy?
