Business Interruption Insurance Calculation: How to Optimally Protect Your Company
13 Apr 2025
Katrin Straub
Managing Director at nextsure
A water damage halts your production, a fire destroys the warehouse – and suddenly it's not just the machines that stand still, but also your income. A business interruption insurance covers the financial consequences, but the correct calculation of the insurance amount is crucial. Learn how to accurately determine your needs and avoid pitfalls.
The topic in brief and concise terms
The sum insured for business interruption insurance must cover the loss of profit and ongoing costs for the entire period of liability.
A strict orientation of the sum insured to the contents insurance (small business interruption) can lead to significant underinsurance; a detailed calculation of the gross profit is often necessary.
Choosing an adequate retention period (often more than 12 months) and regularly adjusting the contract are essential for seamless protection.
Quick Facts: The most important points about the calculation at a glance
The business interruption insurance (BI) covers ongoing expenses and lost profits following an insured property damage. Accurate calculation of the insurance sum is essential for full coverage. The liability period, usually twelve to 24 months, defines the duration of benefits. Small business interruption insurances are available from as little as nine euros per month.
Many companies underestimate the necessary insurance sum for BI. The basis for calculation is the lost operating profit and ongoing costs. A careful analysis of your financial figures is therefore the first step.
Practical Explanation: Accurately Determining the Insurance Sum
The accurate determination of the sum insured is the cornerstone of any business interruption insurance. An amount that's too low leads to underinsurance and painful gaps in coverage when a claim occurs. For many businesses, contents insurance is the foundation, but business interruption insurance goes beyond this.
There are generally two approaches to determining the sum insured:
Small Business Interruption Insurance (KBU): Here, the sum insured often aligns with the sum of contents insurance. This can quickly result in underinsurance, for example, of 40,000 euros for service-oriented businesses with low tangible assets but high profit potential, as demonstrated by a case study of a butchery.
Medium and Large Business Interruption Insurance (MBU/GBU): Here, a more detailed calculation is conducted. The simplified formula is: annual net turnover minus variable costs (such as cost of goods sold) equals the gross profit. This gross profit, plus a reserve of approximately ten percent, constitutes the sum insured. An example: An annual net turnover of 500,000 euros minus 260,000 euros for cost of goods sold results in a gross profit of 240,000 euros; with the reserve, 264,000 euros would need to be insured.
Make sure to consider all relevant costs and potential profit over the entire period of liability. The business performance analysis provided by your accountant offers a good foundation for this. This ensures that your insurance actually covers you in the event of a claim.
Custody and Evaluation Period: Temporal Dimensions of Protection
In addition to the sum insured, the indemnity period and valuation period are crucial parameters of your business interruption insurance. The indemnity period is the time for which the insurer provides coverage after the occurrence of property damage, with a maximum duration. Common periods are twelve, 18, or 24 months, and in some cases even 36 months. Keep in mind that the full restoration of operational readiness, especially with specialized machinery or lengthy approval processes, can often take more than twelve months.
The valuation period has the same duration as the indemnity period, but it ends with the actual end of the business interruption and is determined retroactively. It is used to assess whether underinsurance exists by comparing the originally calculated sum insured with the hypothetical earnings during the downtime. A period chosen too short can result in the coverage ending before your business is fully operational again. A careful coverage for trade and crafts takes these periods into precise consideration.
Costs and Influencing Factors: What does business interruption insurance cost?
The cost of business interruption insurance is individual and depends on several factors. These include the industry, the chosen insurance amount, the agreed indemnity period, and any excess. A small business interruption insurance policy may already be available for under ten euros a month. For larger companies with higher risks and insurance sums, the premiums increase accordingly.
The following factors significantly influence the premium:
The insurance sum: Directly derived from your potential loss of earnings and ongoing costs.
The indemnity period: Longer periods (e.g., 24 instead of twelve months) increase the premium.
The industry and individual risk: A manufacturing business with expensive specialised machinery often has a higher risk than a purely consulting firm.
The excess: A higher deductible reduces the premium, but means more personal contribution in the event of a claim.
Selected coverage extensions: Additional protection, for example against natural hazards, affects the price.
Do not just compare the price, but especially the services and conditions. Affordable business liability insurance is important, but with BUV, the precise protection is crucial. A thorough risk analysis helps to find the optimum balance between cost and coverage.
Design Tips for Optimal Protection: Avoid Pitfalls
The proper structuring of your business interruption insurance is crucial to ensure you are not left in the lurch in an emergency. A common mistake is aligning the sum insured for business interruption insurance (BII) solely with the property insurance sum of the contents insurance. In the case of an advertising agency, this led to a coverage gap of 30,000 Euros, as expensive electronics were covered by a separate cyber insurance for businesses or electronics insurance and were not included in the BII minimum sum insured.
Here are some specific structuring tips:
Conduct a detailed assessment of the sum insured, based on gross profits and ongoing costs, not just on material values.
Include values from specialised insurance (e.g., machinery, electronics insurance) when considering the minimum sum insured for BII.
Choose a sufficient indemnity period that covers realistic restart times for your operation—twelve months are often too short.
Check if a mid-sized business interruption insurance (MBI) with more flexible indemnity periods and a needs-based sum is more suitable than a BII.
Ensure all relevant risks are included; natural disaster damage is not always covered automatically.
Our expert tip: Have your insurance situation reviewed regularly, at least every two years. Do not underestimate the dynamic development of your business, and adjust your insurance cover accordingly. A stationary machinery insurance can be a sensible addition if your business heavily relies on specific equipment.
Your next step towards financial security
The correct calculation and arrangement of your business interruption insurance is a complex but essential topic for the financial stability of your company. It protects your life's work from unforeseen events that can quickly lead to losses of several tens of thousands of euros. With knowledge of the correct calculation methods, the importance of indemnity periods and insurance sums, and potential pitfalls, you are well prepared. Remember, even small businesses can receive basic protection from as little as nine euros per month.
A proactive approach to this topic pays off manifold in an emergency. Take advantage of professional consultation to accurately determine your individual needs and find a tailor-made solution. This way, you can focus on your core business with the assurance that your company is safeguarded even in times of crisis. Investing in comprehensive advice can protect you from coverage gaps of up to 40,000 euros or more.
Request your individual risk analysis now: Have your insurance situation checked free of charge and receive concrete suggestions for optimisation.
More useful links
Wikipedia provides a comprehensive overview of business interruption insurance and its significance.
The portal existenzgruender.de of the BMWi offers valuable information on risk management for entrepreneurs.
PwC Deutschland offers insights and expertise on the topic of risk management for businesses.
The Fraunhofer-Gesellschaft presents research findings and approaches in the field of risk management.
FAQ
Was ist der Unterschied zwischen einer kleinen und einer mittleren/großen Betriebsunterbrechungsversicherung?
Die kleine Betriebsunterbrechungsversicherung (KBU) koppelt die Versicherungssumme oft an die Inhaltsversicherung, was zu Unterdeckung führen kann. Die mittlere (MBU) oder große (GBU) Betriebsunterbrechungsversicherung basiert auf einer detaillierten Berechnung des Rohertrags (Umsatz minus variable Kosten) und bietet meist passgenaueren Schutz und höhere Versicherungssummen.
Wie wird die Versicherungssumme bei der Betriebsunterbrechungsversicherung berechnet?
Für MBU/GBU wird der Jahresnettoumsatz um den Wareneinsatz (variable Kosten) reduziert, um den Rohertrag zu erhalten. Dieser Rohertrag, oft zuzüglich eines Vorsorgeaufschlags (z.B. zehn Prozent), bildet die Versicherungssumme für die vereinbarte Haftzeit.
Wie lange zahlt die Betriebsunterbrechungsversicherung im Schadenfall?
Die Versicherung zahlt für die Dauer der Betriebsunterbrechung, maximal jedoch für die vertraglich vereinbarte Haftzeit (z.B. zwölf oder 24 Monate) und bis zur Höhe der Versicherungssumme.
Was passiert bei Unterversicherung in der Betriebsunterbrechungsversicherung?
Bei einer Unterversicherung wird die Entschädigung nur anteilig im Verhältnis der Versicherungssumme zum tatsächlichen Versicherungswert geleistet. Das bedeutet, Sie erhalten nicht den vollen Schaden ersetzt.
Welche Rolle spielt die betriebswirtschaftliche Auswertung (BWA) bei der Berechnung?
Die BWA ist eine wichtige Grundlage zur Ermittlung der fortlaufenden Kosten und des potenziellen Gewinns und hilft somit, eine realistische Versicherungssumme für die Betriebsunterbrechungsversicherung festzulegen.
Was sind typische Schadenbeispiele für eine Betriebsunterbrechungsversicherung?
Typische Beispiele sind ein Brand in einer Produktionshalle, der die Fertigung für Monate stoppt, ein Wasserschaden in einem Restaurant, der zur Schließung führt, oder Vandalismus nach einem Einbruch, der die Betriebsfähigkeit einschränkt.
