Business Interruption and How to Calculate Gross Profit (SearchBite) - Searchlight Insurance Training

Business Interruption and How to Calculate Gross Profit (SearchBite)

A major problem with B.I. insurance is that the accounting terms, such as Gross Profit and Gross Income used in insurance policies don’t  have the same meaning as in accountants.

This intensive 2 hour SearchBite will introduce the concept of consequential loss (or Business Interruption (BI) or loss of profits as it is often known).

It will consider what profit is and differentiate between this and loss of profits under business interruption.

Level:

Duration: 0.2 day(s) CII CPD Hours: 2
     

Key programme elements:

This SearchBite will review the concept of Business Interruption (loss of profits) and focus on what is meant by a loss of profits in an insurance sense.

  • We will look at what Business Interruption (loss of profits) is and how and when it operates
  • It will differentiate between accounting profit and profit as defined under the policy
  • The SearchBite will look at how Gross Profit is calculated by considering a reduction in turnover and increased cost of working
We will look at what Business Interruption (loss of profits) is and how and when it operates.

By the end of this SearchBite, participants will be able to:

 

•Explain what a Business Interruption (loss of profits) is, and when Business Interruption operates
•Outline the accounting concept of profit and explain how this differs in relation to a loss of profits policy
•Explain how insurance Gross Profit is calculated and how, following a loss, a claim under the BI policy will be limited