Ensuring Contingent Business Interruption Coverage

Law360, New York (March 31, 2009, 12:00 AM ET) -- In insurance coverage cases relating to the application of contingent business interruption coverage, insurers consistently argue that there must have been a “total cessation” of operations, no matter the applicable policy language.

They further argue that if there was no “total cessation” of business operations, the insurers are not obligated to provide contingent business interruption coverage. The insurers’ arguments, however, are wrong.

First, an overview of contingent business interruption coverage. “Regular business-interruption insurance replaces profits lost as a result of physical damage to the insured’s plant...
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