Business Interruption Insurance After a Hurricane: What You’re Really Entitled To
My business shut down after a hurricane in Louisiana — how much am I really supposed to get from my insurance company?
When hurricanes tear through Southeast Louisiana, the damage they leave behind goes far beyond physical destruction. For many businesses in New Orleans, Metairie, and Jefferson Parish, the real financial blow comes from lost income: when the lights go out, the doors shut, and customers disappear.
That’s where business interruption insurance comes in. But what should be a safety net often turns into a maze of insurance fine print, delays, and denied claims.
If your business had to close after a storm, whether due to physical damage, power outages, or supply chain disruptions, you need to know what you’re really entitled to under your policy and what steps to take to make sure you’re not leaving money on the table.
What Is Business Interruption Insurance?
Business interruption (BI) coverage is designed to replace lost income when a covered event, like a hurricane, forces your business to shut down or significantly scale back operations.
It’s not a standalone policy. BI coverage is typically included as part of your commercial property insurance or added through an endorsement.
What BI Insurance Typically Covers:
- Lost Net Income/Profits: This is the revenue your business would have earned during the period of interruption, minus expenses that do not continue (e.g., raw materials if production stops). Calculating this can be highly contentious.
- Continuing Operating Expenses: These are the necessary expenses that continue even when your business is closed or partially operational. This often includes:
- Payroll for key employees (to prevent losing skilled staff).
- Rent or lease payments.
- Loan payments.
- Taxes.
- Utilities (if they continue to be incurred).
- Extra Expenses: Costs incurred to minimize the interruption or to operate out of a temporary location. This might include:
- Renting temporary office space or equipment.
- Relocation costs.
- Overtime pay for employees working on recovery.
- Expedited shipping for materials.
But in practice, many businesses in St. Tammany Parish and St. Charles Parish have found that what they thought was covered doesn’t always match the insurer’s interpretation.
Let Bloom Legal Network connect you with a Louisiana property damage attorney who can review your policy and help you understand the true scope of your BI coverage.
What Triggers a Business Interruption Claim?
Insurers typically require direct physical damage to your insured property to trigger BI coverage. That’s where things can get complicated.
Let’s say:
- Your restaurant loses power for a week after a storm
- Your warehouse floods and can’t be accessed
- A mandatory evacuation order forces your storefront to close
In these situations, coverage may depend on:
- Whether your policy includes civil authority coverage
- If flood damage is covered separately
- Whether power loss was due to on-site vs. off-site damage
Even when your losses are real and well-documented, your insurer may argue the damage wasn’t “direct,” or that other exclusions apply.
Tip: Document all reasons for closure, even if there’s no visible structural damage. Contact Bloom Legal Network early; we’ll help match you with an attorney who can make sure your claim is grounded in the policy language that matters.
Common Tactics Insurers Use to Undervalue BI Claims
Business owners across Southeast Louisiana frequently run into the same roadblocks when trying to recover under their business interruption policies:
1. Lowballing Your Lost Income
Insurers may use unrealistic or overly conservative projections of your past income, ignoring seasonal fluctuations, growth trends, or pre-booked contracts.
2. Miscalculating Your Period of Restoration
They may try to shorten the time they think your business should have reopened, even when delays were caused by supply shortages, inspections, or regional restrictions.
3. Denying Claims Based on Technicalities
For example, classifying the shutdown as flood-related (when your BI coverage is wind-only) or blaming the power company.
If your payout doesn’t reflect the true cost of your downtime, don’t let it slide. Speak with an experienced business interruption insurance lawyer Louisiana who can challenge low offers and protect your business.
Proving Your Losses: What Documentation Matters Most
To support a strong business interruption claim, gather:
- Monthly and annual financial statements (past 1–2 years)
- Tax returns and profit & loss reports
- Employee payroll records
- Bank statements showing business deposits and expenses
- Cancelled contracts or customer notices tied to the storm
- Invoices for temporary fixes or relocation costs
The more detailed your records, the better your case. And if you’re missing some, don’t panic; a good attorney can help reconstruct financials and present your losses effectively.
What About Extra Expense Coverage?
Most BI policies also include extra expense coverage, costs you incur to mitigate losses or keep your business going.
Examples include:
- Renting a temporary location
- Leasing equipment to replace damaged items
- Paying expedited shipping to restock inventory
If you operate a short-term rental in St. Tammany Parish or a retail shop in New Orleans, these extra expenses can make the difference between staying afloat and shutting down for good.
Don’t assume the insurance company will factor these in! Bloom Legal Network can connect you with an attorney who makes sure every eligible cost is accounted for.
What If the Insurer Delays or Denies Your Claim?
Louisiana law requires insurers to act in good faith and handle claims promptly. If they delay, underpay, or deny your business interruption claim without valid justification, they may be acting in bad faith.
Warning signs of bad faith include:
- Vague or shifting explanations for denial
- Incomplete investigations
- Unreasonable requests for additional documentation
- Delay tactics with no clear resolution timeline
Don’t Leave Money on the Table!
Business interruption insurance is supposed to help your company survive when disaster strikes, not add more stress.
Whether you own a dental office in Jefferson Parish, a boutique in the Garden District, or a restaurant along the lake in Slidell, you deserve to be compensated for your full financial losses.
📞 Call Bloom Legal Network at 504-599-9997
📧 Email info@bloomlegal.com
We’ll connect you with a Louisiana insurance attorney who knows how to get business interruption claims paid accurately, completely, and on time.
Frequently Asked Questions
Business interruption (BI) insurance is designed to replace lost income and cover continuing expenses when a hurricane or other covered event forces your business to shut down. This includes your lost net income or profits, as well as necessary ongoing operating expenses like payroll for key staff, rent, and loan payments. It may also cover “extra expenses” you incur to minimize the interruption, such as the cost of renting a temporary location or equipment.
In most cases, yes. Insurers typically require direct physical damage to your insured property to trigger BI coverage. However, there can be exceptions. For example, some policies may include “civil authority” coverage, which can apply if your business is forced to close due to a mandatory evacuation order, even without direct physical damage. It’s crucial to understand the specifics of your policy, as insurers may try to deny claims by arguing the damage wasn’t “direct” or that other exclusions, like flooding, apply.
If you believe your insurer is undervaluing your lost income, miscalculating your period of restoration, or denying your claim based on technicalities, you should challenge their offer. Insurers may use tactics like ignoring growth trends or claiming a shorter-than-realistic restoration period. It’s important to have strong documentation, including financial statements, tax returns, and payroll records. If your insurer is delaying or acting in bad faith, you may need to seek legal help from a Louisiana property damage attorney who specializes in business interruption claims to ensure you get the full compensation you are entitled to.
