Business interruption (BI) insurance is crucial for private equity firms, as it provides financial protection in the event of unforeseen disruptions to a portfolio company's operations. Interruption in business operations due to natural disasters, supply chain disruptions or cybersecurity breaches can have a significant financial impact to a fund’s bottom line. For private equity firms, business interruption insurance is not only a risk management tool but also a strategic asset that can safeguard their investments, maintain the trust of investors and protect the long-term value of their portfolio companies.

In this episode of The Drawdown, we welcome three members of Cherry Bekaert’s Forensic and Dispute Advisory Services team: Lori Smith, Partner and Practice Leader, and John Collier and J.C. Tuthill, Managing Directors. Together, they discuss:

1:28 - Business interruption insurance triggered upon damage to covered property at the premises
2:30 - Coverage and policy terms for funds and portfolio companies
4:25 - Calculating payment for types of business losses
11:00 - Dependent property coverage
12:55 - Next steps for fund managers

If you or your private equity firm have any questions about business interruption insurance or how to prepare for a disruptive event, please reach out to our Forensic & Dispute Advisory Services team.