Does Business Interruption Cover Supplier Shutdowns?
Only if you have contingent business-interruption coverage and the supplier loss meets its terms.
The cited guidance notes that the supplier may need to be named and suffer qualifying physical damage. Contingent business interruption (CBI) can extend protection when a listed supplier or customer suffers qualifying property damage that interrupts your operations. The Insurance Information Institute notes that CBI can be limited to physical damage and may require named supplier locations; a general supply-chain disruption is not automatically covered.
Check whether direct and indirect suppliers are included, whether locations must be scheduled, which causes qualify, and what waiting period and limit apply. Update the schedule when suppliers change. Ask about broader supply-chain cover if the risk involves road closures, labor shortages, or nonphysical disruptions.
