Not automatically. An off-premises power outage that leaves your office undamaged needs a review of the utility-service wording, not just the business-income limit. Check whether covered physical damage at the utility is required, which facilities and causes are covered, and any financial or time restrictions. At property or BOP renewal, confirm separately whether the provision covers business-income loss, extra expense, or both.
Why an intact office changes the review
Business-income insurance is not a general promise to replace income whenever work stops. Chubb's U.S. educational overview connects the usual trigger to physical damage caused by a covered peril. An outage outside your office therefore calls for a closer look at the terms addressing external service failures.
Travelers' real estate owners product overview illustrates the distinction: its Utility Services description connects an electricity interruption to covered damage at a generating station or other off-premises property. That is an example about that product, not a coverage promise for a software company's policy. The buying implication is to inspect your own utility-service provision. If it requires physical damage, an outage without that damage may fall outside its coverage grant. A higher business-income limit does not resolve whether the outage meets the trigger.
Sources: Business Interruption (Income) Insurance and Coverage Basics · Real Estate Owners Insurance Coverages
Five questions for the electricity-service wording
Chubb's U.S. Customarq Classic overview lists loss of utilities among that product's business-income features. That is product-specific coverage, not evidence that every BOP includes the same protection. Use these questions to inspect the issued forms rather than infer their terms from a feature list.
- Provision: Is off-premises electricity interruption addressed in the base form or an endorsement? Identify the form and edition.
- Damage: Does the provision require covered physical damage at the utility? How would it treat an interruption without that damage?
- Facilities: Which utility equipment is described? Does the wording match the facilities supplying your office?
- Location and causes: Which off-premises utility property and damage causes qualify, and what exclusions apply?
- Coverage granted: Does the provision apply to business income, extra expense, or both?
Sources: Customarq Property & Business Income Coverage · Real Estate Owners Insurance Coverages
Read the clock and the financial definition
Chubb's general overview describes a restoration period and notes that policies can limit its duration. For a utility outage, find the applicable start and end points rather than assuming the rules for repairing damage at your own office apply. Ask about any waiting period, time deductible, separate utility limit and maximum payment period.
Travelers' claims guide describes business income as net income plus normal operating expenses that continue. Extra expense addresses reasonable, necessary additional costs to avoid or shorten a shutdown. For a software company, separate projected net-income loss from payroll and rent that continue, and from costs such as temporary workspace. Being inconvenienced does not, by itself, establish an insured financial loss.
Sources: Business Interruption (Income) Insurance and Coverage Basics · Understanding Business Income Coverage
Test one realistic software-company scenario
Hypothetical example: A fire damages a utility-owned transformer, cutting electricity to a software company's office. Nothing inside the office is damaged. Its hosted platform remains available, but the office-based support team moves to temporary space.
Use that scenario to test three separate issues: whether damage at the utility triggers the provision; which operations were actually interrupted; and whether the temporary-space costs fall within its extra-expense coverage. None of those answers should be assumed from the scenario alone.
Do not count all subscription revenue as lost income merely because the office closed. Document what continued, what stopped and what additional expense was incurred. This creates a more useful renewal discussion than describing the exposure simply as downtime.
Sources: Real Estate Owners Insurance Coverages · Understanding Business Income Coverage
Prepare a focused renewal or quote discussion
Build a short exposure summary: office locations, teams that depend on onsite power, available backup runtime and activities that can continue remotely. Keep the coverage question specific: off-premises electricity interruption with no damage at the office. Review that scenario separately from damage to your own equipment or an outage at a cloud-hosting provider.
For a property or BOP quote discussion with Atlas Risk Partners, use that summary and the checklist below to identify the provisions to compare. Do not substitute a larger overall limit for an unresolved utility-service coverage question.
Availability varies by carrier, state and risk. This is general education and does not bind or establish coverage; policy wording controls.
Sources: Real Estate Owners Insurance Coverages · Business Interruption (Income) Insurance and Coverage Basics · Understanding Business Income Coverage
Your preparation checklist
- Locate the business-income form and all utility-service endorsements for your own review.
- Confirm the office location and operations described in the policy.
- Identify the required damage, utility facilities, covered causes and applicable exclusions.
- Record any utility sublimit, waiting period, time deductible and maximum covered duration.
- Confirm whether the utility provision extends to extra expense.
- Map which work would stop and what could continue remotely.
- Separate projected net-income loss, continuing expenses and temporary-workspace costs.
- Plan to retain utility notices, outage timelines, accounting records and expense invoices.
Sources and editorial approach
Atlas publishes practical insurance education using public regulatory and insurer materials. Insurer examples describe their own products and do not establish Atlas market access. Your policy and endorsements determine actual coverage. This article is general information; it does not bind coverage or replace advice about your particular business.
- Business Interruption (Income) Insurance and Coverage Basics
Chubb U.S. educational overview dated November 28, 2020. Explains the usual physical-damage trigger and restoration-period restrictions while emphasizing policy variation.
- Real Estate Owners Insurance Coverages
Travelers real estate owners product overview. Its Utility Services description links electricity loss to covered damage at off-premises property. Used only as a product-specific example, not evidence of software-company eligibility or coverage.
- Customarq Property & Business Income Coverage
Chubb U.S. Customarq Classic product overview. Utility-interruption features are examples about that product only, not another policy's terms.
- Understanding Business Income Coverage
Travelers claims education explaining net income, continuing operating expenses, extra expense and the period of restoration. The article does not adopt its illustrative customer scenario.
Have a correction or a question? Contact Atlas.
