Close-up of an application form for business interruption insurance for contractors

4 Benefits of Business Interruption Insurance for Contractors

Feb 18 2022

 Running a contracting business already has its own set of day-to-day challenges. Contractors need to keep business operations on schedule, satisfy their clients, stay ahead of the competition—all while making sure that the bottom line is enough to keep the business running. 

Events like natural calamities, fire, and other causes of property destruction can bring everything to a grinding halt. Luckily, business interruption insurance for contractors is here to save the day.

So whatever type of contracting business you may have, your business will have an added level of security when you set up business interruption insurance. Essentially, this type of insurance stops the chain of loss in the face of covered perils.

 This guide covers all the benefits that this type of insurance entails. Let’s get started!

A hand stopping a trail of falling dominos, representing how business interruption insurance for contractors stops the chain of loss during a disaster

What Is Business Interruption Insurance for Contractors? 

Business interruption insurance is a type of commercial insurance that covers lost income following a covered disaster or accident.

For business interruption coverage to be triggered, the situation must meet all of these conditions: 

  1. A disaster, accident, or social unrest causes commercial property damage/destruction/ inaccessibility
  2. The incident in the previous point is a covered peril in the policy
  3. The property damage sustained causes a business interruption

Because business interruption coverage is linked to what happens to the insured’s property (i.e. damage or inaccessibility), business interruption insurance for contractors is typically nestled under commercial property insurance.

Can Business Interruption Insurance Be Purchased by Itself? 

Purchasing business interruption insurance alone is not a common practice in the world of insurance. This is because it only covers one portion of loss during a disaster, social unrest, or accident. 

Business interruption insurance essentially covers financial loss due to halted operations. What it doesn’t cover is the material loss tied with property damage. This other aspect of loss is covered by commercial property insurance.

Commercial property insurance gives payouts for repair costs when the property itself (or the contents of the property) is damaged or subjected to theft/vandalism. 

In some cases, business interruption insurance for contractors may be marketed as a part of what’s known as a business owner’s policy (BOP). Even then, it is typically under commercial property insurance.

Benefits of Having Business Interruption Insurance for Contractors

1. Recover Quickly From a Wide Range of Perils

Business interruption insurance for contractors covers a wide range of perils such as fire accidents, explosions, burst pipes, theft, and vandalism. 

All of these perils cause material loss, which is covered by commercial property insurance. The financial loss (in the form of lost income during downtime) is also covered by commercial property insurance—via business interruption insurance. 

So what would this look like exactly? How much support can you get from business interruption insurance? 

In the table below, we break down the common perils covered by business interruption insurance, along with estimates on how long their repairs would take. Multiply these time estimates by your business’s income per day and you’ll get an idea of how much support business interruption can give, in the face of such unforeseen events. 



Estimated Amount of Time to Recover

1. Fire Accidents and/or Explosions

2. Burst Pipes

3. Theft

  • A few days or weeks, depending on how valuable the stolen item is to business operations and when it can be replaced;
  • Also depends on how extensive the damage is due to the break-in

4. Vandalism

  • A few days or weeks, depending on the extent of the vandalism


Having a halted contracting business, on top of property/equipment damage, creates a chain of loss—and this means uninsured businesses will take more time to fully recover. Conversely, by setting up business interruption insurance (under commercial property insurance), your business will be ready for anything. 

2. Earthquakes and Floods Can Be Covered Too

Earthquakes and floods can be devastating for all kinds of businesses. Unfortunately, these perils aren’t covered in most standard commercial property insurance policies. 

However, you can choose to have these perils added to your commercial property insurance— through business interruption insurance. To do this, speak to an expert at a trusted insurance broker, such as KASE Insurance.

The aftermath of an earthquake, a peril that can be covered by business interruption insurance for contractors

3. Retain Your Valuable Employees Even After a Disaster, Accident, or Amidst Social Unrest

In the face of various perils, business interruption insurance will continue to supply your business with lost income—up to the coverage limit of your policy. This enables a business to not only recover faster but also retain its valuable employees. 

On the other hand, loss of employees is inevitable for uninsured businesses, especially when the business takes too long to recover. 

4. Have Peace of Mind

Business interruption insurance, as a part of the broader commercial property insurance, gives you peace of mind. Your business, as well as its properties and equipment, are incredibly valuable to you. In case an accident, disaster, or social unrest occurs, this type of insurance can catch you so your business doesn’t fall.

Business interruption insurance, under commercial property insurance, secures your physical property and your income in the face of various unforeseen events. 

Business Interruption Insurance That You Can Count On

Ready to get business interruption insurance for contractors? We’re here to help!

KASE Insurance is a trusted and award-winning insurance brokerage firm in Ontario. We specialize in providing customized business interruption insurance for contractors, along with various other insurance solutions.

Whatever your needs may be, we can put together the most fitting, personalized policy that fully protects your business and helps you succeed. If you would like to learn more, reach out to our friendly team today! .

Leave A Comment

You must be logged in to post a comment.