Which type of business insurance provides coverage for lost income?

Business Income Insurance is specifically designed to cover lost income that a business suffers due to a disruption in its operations, typically as a result of property damage caused by a covered peril. This type of insurance provides crucial financial support by compensating for lost profits during the period that the business is unable to operate due to such damages.

For example, if a fire damages a restaurant, Business Income Insurance would cover the income that the restaurant would have made during the time it is being rebuilt and can’t serve customers, thus supporting the business during a critical recovery phase.

In contrast, General Liability Insurance focuses primarily on protecting against claims of bodily injury or property damage to third parties, rather than supporting income loss. Workers' Compensation Insurance provides coverage for employees who are injured on the job, covering their medical expenses and lost wages but does not address lost income for the business itself. Property Insurance safeguards the business's physical assets against loss or damage but does not directly provide for the loss of income. This is why Business Income Insurance is correctly identified as the type of coverage that specifically addresses lost income.