How to set correct business interruption sums insured in a high inflation world

Tuesday, 18 June 2024
12:00 pm – 1:00 pm (UK time)
    • Alan Chandler, CEO, Alan Chandler Training

How to set correct business interruption sums insured in a high inflation world

Presented by Alan Chandler, one of the UK's most popular insurance presenters. Alan will take this opportunity to run through how business interruption insurance should be correctly set up. Alan will lift the myths away from Bi and show how, in his easy to understand style, you can get this cover on a correct footing going forward.

Double digit inflation over the last few years has meant that costs have increased substantially, even if profits have not. Business interruption insurance is designed to pick up the fixed costs of a business not just their profit, and clients need to make sure full consideration is given to the effects of inflation when setting sums insured.

For a business with stock, there is a gross profit formula the client must follow, but many policyholders fail to adhere to this formula meaning they face significant under insurance in the event of a claim.

There is also an issue with policyholders that provide a service. For those on a loss of turnover (fee) basis, often the effects of inflation during the forthcoming year are ignored. For those risks that have to set their own increased cost of working only cover sum insured, often the figures given to the insurer are well out of date, leaving the insured significant under protected in the event of a claim.


This presentation will show how to get the business interruption sums insured correct.

Learning Objectives:

Following this presentation, you will:

  • Be able to help your clients set a correct gross profit sum insured.
  • Be able to explain to your clients the difference between accounting gross profit and insurance gross profit.
  • Be able to best set up BI cover for service firms with no stock on a correct basis taking onto account inflation.
  • Be able to guide your clients on setting an appropriate sum insured for policyholders on an increased cost of working only cover.

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CII Accredited

This demonstrates the quality of an event and that it meets CII member CPD scheme requirements.

1 hour's CPD can be claimed for this event if relevant to your learning and development needs.

It is recommended that you keep any evidence of the CPD activity you have completed and upload copies to the recording tool as the CII may ask to see this if your record is selected for review. Details of the scheme can be viewed online at www.cii.co.uk/cpd.