Business interruption claims: proving the income you lost.

What business income covers

A commercial hurricane causes two separate losses. The first is physical: the roof, the equipment, the inventory, paid on the property side of the policy. The second is the income the business stops earning while it is closed, and that is what business-income coverage insures. On the standard ISO CP 00 30 (Business Income and Extra Expense Coverage Form), the trigger is the same one that opens the property claim: a Covered Cause of Loss must cause direct physical loss or damage to the described premises, forcing a suspension of operations.

What it pays is defined precisely. "Business income" is the net income (net profit or loss before income taxes) that the business would have earned, plus the normal operating expenses that continue during the period of restoration, including payroll. That last clause matters: coverage keeps the lights, the lease, and the staff funded through the shutdown, not just the lost profit. A Causes of Loss form, CP 10 30 (Special), CP 10 20 (Broad), or CP 10 10 (Basic), has to be attached to say which perils count; hurricane wind is a covered cause under all three.

Extra expense

The "and Extra Expense" in the form title is a second, distinct coverage, and one businesses under-use. Extra expense pays the necessary costs you incur to keep operating, or to speed the restoration, that you would not have incurred had there been no loss. Renting a temporary location, leasing replacement equipment, expediting repairs, paying overtime to reopen faster: all extra expense. Extra expense coverage has no 72-hour waiting period; it begins immediately at the time of loss.

The two coverages work together. Money spent on extra expense often reduces the business-income loss: a temporary storefront that keeps revenue flowing shrinks the income claim. Well-run claims spend on extra expense to cut the larger loss, and the policy rewards that.

The restoration clock

Business-income coverage does not run forever. It runs for the period of restoration, a window the form defines at both ends, and the single most litigated element of a BI claim. It begins 72 hours after the direct physical loss and ends on the earlier of the date the property should be repaired, rebuilt, or replaced with reasonable speed and similar quality, or the date the business resumes at a new permanent location.

The phrase "with reasonable speed" decides the end date. The carrier measures it against an idealized repair schedule; the policyholder measures it against the real world after a hurricane, where permits back up, licensed contractors are booked for months, and manufacturers ration materials across an entire damaged region. Every one of those delays outside the business’s control extends the honest period of restoration. Each has to be documented as it happens, not reconstructed later.

The 72-hour waiting period

The standard CP 00 30 builds a 72-hour waiting period into business-income coverage: nothing is payable for income lost in the first 72 hours after the direct physical loss. It works as a time deductible, and it applies only to the business-income side; extra expense begins immediately. For a business closed for weeks, three days is minor; for a short closure, it can erase the whole claim. Some commercial policies buy the waiting period down to 24 hours, or out entirely, by endorsement, a line worth checking on the declarations before the season, not after.

ISO CP 00 30 · PERIOD OF RESTORATION, "BEGINNING" (TYPICAL WORDING)

"Period of Restoration means the period of time that: Begins … 72 hours after the time of direct physical loss or damage for Business Income Coverage … and Ends on the earlier of: the date when the property … should be repaired, rebuilt or replaced with reasonable speed and similar quality; or the date when business is resumed at a new permanent location."

Civil-authority orders

The most valuable and most contested extension of business-income coverage pays when your building is fine but the government closes the area around it. Under the standard CP 00 30 civil-authority grant, coverage applies when a Covered Cause of Loss damages property other than your premises, a civil authority prohibits access to the area as a result, and your premises sit within that area but not more than one mile from the damaged property. Coverage begins 72 hours after the order and runs for up to four consecutive weeks.

The courts police the trigger tightly, and the recurring loss is the same: an order issued in anticipation of a storm, before any property is damaged, does not qualify. In Dickie Brennan & Co. v. Lexington Insurance Co. (5th Cir. 2011), a New Orleans restaurant’s claim for a pre-Gustav mandatory evacuation failed because the order was precautionary; it lacked the required nexus to prior damage to nearby property. In Southern Hospitality, Inc. v. Zurich American Insurance Co. (10th Cir. 2004), the post-9/11 FAA ground-stop failed the same test: it was a national response to a feared future risk, not an order caused by physical damage to neighboring property. The lesson for a hurricane file: the winning civil-authority claim ties the closure order to actual, documented damage to identifiable property within a mile, not to the evacuation that came before the wind.

Ingress / egress

Civil-authority coverage turns on a government order. Ingress/egress coverage turns on a physical fact: you cannot get to or from your premises because roads are blocked, bridges are out, or debris makes access impossible, whether or not any authority has ordered anything. After a hurricane the two frequently overlap, but they are separate grants proven by separate evidence, and the distinction decides claims.

The catch: ingress/egress is not part of the standard ISO CP 00 30. It appears in manuscript commercial forms and in the named-storm endorsements common on coastal policies. If your business depends on a single causeway or a barrier-island road, whether you carry ingress/egress coverage, and what radius and waiting period it uses, is worth confirming line by line before the storm. Where a policy has both, a coordinated claim pleads civil authority and ingress/egress in the alternative, so a failure of the order’s nexus does not sink a loss the blocked road independently supports.

Dependent-property coverage

A hurricane can idle your business without touching your building, by destroying the supplier you depend on, or the customer who buys everything you make. Dependent-property coverage, also called contingent business interruption, is the ISO extension for exactly that: forms CP 15 08 (Broad) and CP 15 09 (Limited) extend business-income coverage to income you lose when a Covered Cause of Loss damages a scheduled dependent property rather than your own premises. The four categories:

• Contributing location: a property that supplies materials or services to you. Your key parts supplier, wiped out inland, stops your line on the coast.
• Recipient location: a property that buys your products or services. Your single largest customer floods and stops ordering.
• Manufacturing location: a property that makes your products for delivery to your customers under contract.
• Leader location: a property that draws customers to you: the anchor store or attraction whose closure empties your parking lot.

The coverage only works if you scheduled the dependent property and a Covered Cause of Loss damaged it. The Broad Form (CP 15 08) makes the full business-income limit available to a dependent-property loss; the Limited Form (CP 15 09) requires a separate scheduled limit. For any business with a concentrated supply chain or a single dominant customer in hurricane country, it is the coverage that turns "someone else’s storm" into a payable loss.

The documentation battle

This is where business-income claims are won or lost. Unlike a roof, a business-income loss has no physical evidence; it is a but-for projection: what the business would have earned had the storm never happened, net of expenses that did not continue during the shutdown. Every dollar of that projection is an argument, and the carrier retains its own forensic accountant to attack it.

The proof stack that survives that attack, in order of weight:

1. Historical financials: profit-and-loss statements and general ledgers, ideally three years, showing the seasonal shape of the business the projection has to match.
2. Federal and state tax returns: the hardest number to argue with, because the business already swore to it.
3. Point-of-sale and sales records: daily and weekly revenue that lets the projection track the actual pre-storm trend, not just an annual average.
4. The but-for model: a forensic accountant’s projection of the restoration-period revenue, net of non-continuing expenses like cost of goods not purchased.
5. Contemporaneous delay records: the permits, bids, and lead-time emails that justify the length of the period of restoration.

Two obligations sit behind all of it. The policy requires you to produce your books and cooperate; stonewalling the carrier’s document requests can jeopardize the claim outright. In Florida the notice deadlines still apply: a claim must be filed within the § 627.70132 windows, and the carrier owes a pay-or-deny decision under § 627.70131. The cleaner and more contemporaneous the records, the less room the carrier’s accountant has to move the number.

Florida vs. South Carolina

ISO form summaries and case holdings are summarized as of July 2026, and policy editions differ. Confirm the edition date and exact wording on your own CP 00 30 and any named-storm endorsement before relying on it.

Business-interruption claims: the questions owners ask

Not legal advice; consult an attorney about your specific claim.