Which type of insurance specifically covers business interruptions?

Business interruption insurance is specifically designed to cover the loss of income that a business suffers after a disaster, such as a fire or flood, which disrupts its normal operations. This type of insurance allows companies to recover lost revenue and cover operating expenses during the downtime resulting from the event. It addresses the financial impact of being unable to conduct business, ensuring that fixed expenses, payroll, and other financial obligations can still be met despite the interruption.

On the other hand, commercial property insurance primarily focuses on protecting physical assets from damage or loss due to specified risks, but it does not inherently cover the income loss associated with business interruptions. Liability insurance is concerned with protecting against legal claims due to injuries or damages caused by the business, while homeowners insurance is tailored for personal residences and typically does not extend to business operations or interruptions.