Here for you.
What we do key takeaway:
- Identify whether the insured is subject to a coinsurance provision, and if so calculate the coinsurance percent and apply it to the calculated business interruption loss before coinsurance.
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What is Coinsurance?
Coinsurance is essentially a partnership between you (the policyholder) and your insurance company. It’s designed to ensure that you have sufficient coverage for the value of your business income.
How Does Coinsurance Work?
When a coinsurance clause is part of your policy, it requires that you cover your business income for a minimum percentage of its actual value. This percentage is predetermined in your insurance policy. If you decide to insure your property for less than this percentage, you are effectively agreeing to share some of the risk with your insurer. This means if a loss occurs, you won’t receive a dollar-for-dollar reimbursement but rather a proportionate amount based on the level of coverage you purchased compared to what was required.
