Does Business Interruption Cover Utilities?
Sometimes—continuing utility bills may be part of a covered income loss; an outage that causes the shutdown may require a service-interruption endorsement with physical-damage terms and distance limits.
But an outage that itself stops operations raises a separate trigger question. NAIC guidance says service-interruption clauses may cover direct physical damage to utility services and transmission equipment, often with distance limits and peril exclusions. Those provisions may be optional or endorsement-based.
Check whether the policy requires damage at your premises or extends to a utility supplier’s property. Review covered services, distance radius, causes of loss, waiting period, and any separate income or extra-expense sublimit. Ask whether the utility must be named and whether a power interruption without physical damage qualifies.
Coverage Guides Related to Commercial Property Insurance
Sources for Commercial Property Insurance Answers
- Business Interruption and Business Owner Policy. National Association of Insurance Commissioners; Background; Commercial property; Business interruption; Contingent business interruption. Accessed 2026-09-25.
- FAQ on business interruption insurance and other issues affecting California small businesses. California Department of Insurance; Business interruption trigger; COVID-19 income loss; policy exclusions; civil authority. Accessed 2026-09-25.
- What Business Income Loss Coverages Are Out There? Learn the Endorsements That Can Help with Lost Business Income. National Association of Insurance Commissioners; Top Considerations; Things You Should Know: business income, extra expense, service interruption, contingent business interruption, civil authority. Accessed 2026-09-25.