Risky Business

October 2011

People on Hand

Welcome to this month's edition of "Risky Business".

This month we discuss Business Interruption Cover, which protects the income stream to your company in the event of material damage occurring.


  Insurance News 

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Business Interruption


Do you currently have Business Interruption Cover in your Business Insurance Package? If you do not know already, this is cover for the income that cannot be generated by your Business due to Material Damage occurring at your premises.


The Insurance Council of Australia estimates 50% of small to medium size businesses cease operating within three years without this cover or enough cover following a fire or other interruptions. But with an appropriate level of Business Interruption Insurance, you would be able to manage this loss and maintain the profitability of your business.

It is not just a fire that can cause interruption to your business. It could be Storm Damage, or other Damages you are covered for. Perhaps the neighbouring building has had the fire or a crime has occurred and you cannot get access to your building for a while. If you have lost access or availability, you would lose the ability to make money.

It protects the income stream to your company. The shortfall in your Gross Profit is covered by Business Interruption Insurance (also known as Consequential Loss or Loss of Profits Insurance) and has
the following four main components:

1.  Business Interruption (BI) Cover: Replaces the loss gross earnings (profit) during the shut-down resulting from a covered property loss. The cover can also continue to pay your workforce while you have no work for them.

2. Additional Cost of Working: Cover the cost to relocate to another building and continue operations. During relocation, businesses typically incur the extra expenses of rent, equipment lease and the cost of advertising. All of which are covered by this section of the policy.

3. Claims Preparation Costs: The coverage is optional, but is recommended in the circumstances where you need to hire a professional to help prove your loss.

4. Indemnity Period: This is how long you will continue to be paid from the date of loss. It needs to factor in not only the time to actually rebuild or repair machinery or replenish stock, but also building and repair delays, particularly after a major catastrophe. There can also be delays in obtaining Council approvals or permits. Most Insureds choose only a 12 month indemnity period but that may not be enough.

If you want to discuss this form of cover, call us at CPR. Experts who will save you.

Please click here to read more.



  Joke of the Month 

Tickets Please


Three Kiwi's and three Aussies are travelling by train to a Rugby match at the World Cup in England. 

At the station, the three Kiwis each buy a ticket and watch as the three Aussies buy just one ticket between them.
"How are the three of you going to travel on only one ticket?" asks one of the Kiwi's.

"Watch and learn mate," answers one of the Aussies.    
They all board the train. The Kiwis take their respective seats but all three Aussies cram into a toilet and close the door behind them.

Shortly after the train has departed, the conductor comes around collecting tickets. He knocks on the toilet door and says, "Ticket please." 


The door opens just a crack and a single arm emerges with a ticket in hand. The conductor takes it and moves on. 

The Kiwis see this and agree it was quite a clever idea. So after the game, they decide to copy the Aussies on the return trip and save some money. 

When they get to the station, they buy a single ticket for the return trip. To their astonishment, the Aussies don't buy a ticket at all!

"How are you going to travel without a ticket?" says one perplexed Kiwi. 

"Watch and learn mate," answers an Aussie. 

When they board the train, the three Kiwis cram into a toilet, and soon after the three Aussies cram into another nearby.

The train departs. 

Shortly afterwards, one of the Aussies leaves their toilet and walks over to the toilet where the Kiwis are hiding.

He knocks on the door and says, "Ticket please." 


See you next month.




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