The recent bushfires have meant we have had a number of business interruption claims as a result of prevention of access in the bushfire areas. With the CFA priority often the protection of people and property, claims appear to be far more likely and more frequently arise from the loss of business / gross profit resulting from your customers unable to access your site due to bushfire in the immediate area.

A client, an outdoor education provider was adversely affected when a number of their events held in National Parks were deemed unsafe to run by the fire authority. Clients and staff were required to be relocated mid-programme and in some cases new events relocated with short notice. A business interruption policy covers the loss of gross profit resulting from not being able to run the programmes. Additionally, the policy paid the economic additional / increased costs for relocation so that the business was able to deliver their events in a safe area. Being able to still run the programmes with the higher costs of delivery is always the preferred outcome as there is opportunity to have the same group back next year.

The additional / increased costs cover such things as bus transport for relocation and airline flights, additional staff resources, higher or additional accommodation costs and the like. The organisation which is the subject of this case study was well prepared too! They had conducted advanced emergency planning prior in advance in case such a scenario arose.

A few additional details aside that may assist:

1) Our client called us as soon as it became apparent their business operations were likely to be affected;

2) Our claims manager worked closely with the insurer and client so as to ensure alternate plans were going to be insured by the business interruption policy;

3) Certain costs were approved in advance of the formal claims process which ensured that our client had a mandate from their insurer for these expenses – making it easier on everyone.

Source: Phillips Insurance Brokers
Mark Van Der Haar
Phone: 1800 819 394

Note: Not all business interuption insurance offer this cover, however these sorts of cover can be arranged.

Any information provided is not intended, nor can it be regarded as a substitute for professional, legal or operational advice and no responsibility is accepted for any errors or ommissions. Whilst every care has been taken to ensure accuracy, the articles are not intended to be a definitive statement of the law or liability in any state or territory, or to apply to you specifically in any particular situation.