Also known as: business interruption insurance · lost income coverage · BI coverage
Business income insurance replaces revenue your company loses while operations are suspended after a covered property loss — such as a fire, flood, or theft that forces you to close temporarily.
Business income insurance (also called business interruption insurance) kicks in when a covered physical loss — fire, storm damage, burst pipes — forces you to halt or reduce operations. It pays for lost net income and continuing fixed expenses (rent, payroll, utilities) during the period of restoration: the time it takes to repair or rebuild your property and resume normal operations. Business income coverage is typically bundled inside a commercial property policy or Business Owner's Policy (BOP) — it is not usually sold as a standalone policy. Coverage does not apply to non-physical losses; a cyberattack that forces a shutdown is generally covered under a cyber policy's business interruption endorsement, not under a standard business income policy.
"Business income and extra expense coverage with limits sufficient to cover 12 months of projected gross revenue."
Standard business income (business interruption) insurance requires a physical property loss to trigger — a server damaged in a fire qualifies; a ransomware attack that locks your systems generally does not. Cyber business interruption coverage is a separate endorsement available under cyber liability policies. If your primary risk is a cyberattack rather than a physical loss, ask your broker about cyber BI coverage specifically.
Business income coverage pays for the "period of restoration" — the time reasonably required to repair or replace the damaged property and resume operations. Most policies cap this at 12 months, though some extend to 24 months for larger risks. The policy also typically includes a waiting period (often 72 hours) before benefits begin.
Yes — the two terms are used interchangeably. "Business income insurance" is the more formal policy terminology used by carriers and in ISO policy forms. "Business interruption insurance" is the plain-language name most people use when discussing the coverage. They refer to the same product.
It depends on your physical footprint. If you operate from a leased office with equipment, business income coverage protects against a gap in revenue after a covered property loss. If your team is fully remote with no physical office and all infrastructure is cloud-based, a standard business income policy offers little protection — cyber business interruption coverage under a cyber policy would be more relevant.
Definitions are educational and may be modified by your specific policy language, endorsements, and state rules. For regulatory guidance, refer to the California Department of Insurance or the NAIC.
Last updated: July 2026.