How Does a Business Interruption Insurance Claim Work?

Insurers measure what your business would have earned had the loss never happened, then subtract what it actually earned during the shutdown. That projection comes from historical sales, seasonality, growth trends, and industry conditions — so a business with clean monthly financials recovers far more than one working from memory.

Continuing expenses matter as much as income. Rent, loan payments, insurance, key payroll you chose to retain, and utilities that ran anyway are all part of the claim. Expenses that stopped are deducted.

Coverage runs for the time it should reasonably take to repair or replace the damaged property, not the time it actually took if delays were avoidable. Carriers shorten this period aggressively, because every week they cut removes weeks of income from your payment.

Documented permitting timelines, contractor availability, long-lead equipment, and code-required upgrades all extend a legitimate restoration period. Extended business income coverage may also apply after reopening, while revenue climbs back to normal.

Assemble profit-and-loss statements, tax returns, payroll registers, sales reports by month, vendor invoices, and lease documents. If you operate seasonally, provide multiple years so the projection reflects your real pattern.

Kevin Godfrey, License #PA-1156995, has 22+ years of experience building New York commercial claims including business interruption, and fees run 6–12% on a sliding scale with a free initial review.