The Basic Business Interruption Book (eBook)

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Published Date

April 2020

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The Basic Business Interruption Book (eBook)

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This publication is a practical guide to BI cover, written by BI practitioners. It covers the fundamentals of BI claims, outlining the operative clause and explaining specialist cover in the context of Engineering BI and Cyber BI. It expands on the BI indemnity period and explains common profit and loss terminology.

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The main purpose of this publication is to provide a practical insight into dealing with claims, rather than arranging policy cover. The operative clause is explained in depth, with example scenarios given on concurrent causes of loss and policy response. Chapter 3 provides practical guidance on trading, profit and loss calculations, explaining how the most common types of BI cover work. The book is appended with worked examples of loss calculations.

1. Introduction to Business Interruption Insurance
1.1 Property Damage and Business Interruption
1.2 Core Cover
1.3 Gross Profit
1.4 Increase in Cost of Working
1.5 Indemnity Period/Maximum Indemnity Period
1.6 Consequences and Policy Cover
1.7 Policy Wordings
1.8 Cash Flow and Interim Payments


2. Is it Covered?
2.1 The Operative Clause
2.2 Specialist BI Covers


3. How Does the Cover Work?
3.1 Overview
3.2 Indemnity Period
3.3 Calculation of the BI Indemnity
3.4 Declaration Linked Policies
3.5 Interim Payments
3.6 BI/PD Overlap


4. Concluding Remarks


Appendix A Terminology
Appendix B Loss Calculations − Worked Example

This manual has been written by BI practitioners as a practical guide for practitioners. Most BI claims are relatively straightforward and are not beset with a series of traps. Equipped with a sound understanding of the fundamental principles of BI, such as this book provides, the vast majority of BI claims can be settled to the satisfaction of all interested parties. At the same time, the book flags up those issues where additional research and experience may need to be brought to bear.


Sources of additional analysis, such as Riley on Business Interruption Insurance and Business Interruption Policy Wordings – Challenges Highlighted by Claims Experience, provide in depth coverage of the topic of BI. The latter concentrates on recurring issues surrounding policy wordings but it presupposes a detailed knowledge and experience of matters pertaining to BI.


This book does not assume any prior BI knowledge – the reader is, however, expected to be familiar with the fundamental principles of insurance, in particular commercial property coverage. A short and concise introduction to any topic, not least BI, is far more difficult to compose than a detailed, lengthy study. This book is a short introduction that has been worth the wait.


The Chartered Institute of Loss Adjusters (CILA) is a globally recognised membership organisation for claims professionals. The Institute sets the professional and ethical standards for those who work in the handling of claims through its qualification framework and guide to professional conduct.

The CILA Council is the governing body for the Institute. Day to day activities are overseen by an Executive Committee, which is chaired by the CILA’s Executive Director.

Title: The Basic Business Interruption Book (eBook)
Number of Volumes: 1
Product Code: WS1687EA
ISBN: ISBN 13: 978-1-85609-910-3 (9781856099103), ISBN 10: 1-85609-910-5 (1856099105)
Published Date: April 2020
Author: Chartered Institute of Loss Adjustors

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