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COVID-19: Impacts on business interruption insurance values

16/04/2020


Many businesses have experienced significant economic impacts from the ongoing COVID-19 pandemic. Reduced sales and business closures will affect an organization’s outlook, perhaps for months or years to come. And this sudden unexpected change may require you to revise your annual business interruption insurance values. 

Insurance premium calculations are influenced by business interruption insurance values — and loss-based coverage rests on them. It’s possible your business is currently paying insurance premiums to protect an income stream that simply does not exist anymore. And, if your insurance values reduce, your policy premium will reduce as well.

Are your insurance values still relevant?

The current crisis should encourage organizations to review their insurance values and evaluate the impacts to your employees, customers and ultimately your business outlook. Key factors to consider include industry, consumer demands, pricing and supply chain issues.

What we recommend

Do not wait for renewal to update your business interruption insurance values. MNP’s Insurance Advisory team can help you conduct an assessment to ensure your outlook and your coverage match your current economic environment. Connect with your insurance advisor today to learn more.

For more information, contact Craig Burkart, CPA, CA, IFA, CFF, CIP, National Leader Insurance Advisory, at 403.536.5533 or [email protected] — or Gerald Kim CPA, CA, CBV, CIP, Valuation, Forensics and Litigation Support, at 403.263.3385 or [email protected]

Learn more at MNP's COVID-19 Business Advice Centre

Strategies and tools to help your company navigate the coronavirus crisis, stay resilient and take the next steps towards recovery.