Does Business Interruption Cover Extra Expense?
Extra expense may be included or added by endorsement to pay certain necessary costs that reduce or avoid a covered interruption loss.
Extra expense is related to, but distinct from, lost business income. NAIC says it can reimburse additional costs during repairs, such as rent at a temporary location, and may help a business continue operating. Policies define which expenses qualify and may require that they be incurred because of covered property damage. Ordinary operating costs or elective upgrades may not meet the definition.
Check whether the quote includes an extra-expense insuring agreement, its limit, waiting period, covered locations, and relationship to business-income coverage. Ask how the policy treats expedited repairs, equipment rental, relocation, and costs above the loss avoided. Keep receipts and a record of the operational need for each expense.
Related Coverage
Sources
- Business Interruption and Business Owner Policy. National Association of Insurance Commissioners; Background; Commercial property; Business interruption; Contingent business interruption. Accessed 2026-09-25.
- What Business Income Loss Coverages Are Out There? Learn the Endorsements That Can Help with Lost Business Income. National Association of Insurance Commissioners; Top Considerations; Things You Should Know: business income, extra expense, service interruption, contingent business interruption, civil authority. Accessed 2026-09-25.
- Commercial Property and Business Income Coverage Forms in SES sample policy. Insurance Services Office, Inc.; sample hosted by SES Insurance; CP 00 10 10 12, printed pp.1–16 / PDF pp.7–22: A.1 Covered Property, A.2 Property Not Covered, E.1.b Property of Others, E.1.e Outdoor Property; CP 00 30 10 12, printed pp.1–9 / PDF pp.22–30: Business Income definition, trigger, coinsurance and restoration period. Accessed 2026-09-25.
