WHAT’S IN A NAME?
That which we call Interruption Insurance
By any other word, would cover so sweet.
The policies were originally called Consequential Loss policies but the term and concept were not widely understood and so the term Loss of Profits insurance was coined. This too caused confusion with many companies feeling that their net profit was not high enough to warrant insuring. As we will see later, non profit and even loss making businesses benefit at the time of a loss when they have business interruption insurance.
Therefore terms such Consequential Loss and Loss of Profit have tended to be put aside in favour of Business Interruption or simply, Interruption Insurance. Having said this, Consequential Loss is still used in the Industrial Special Risks policy.
Reference: adapted from Romeo and Juliet (II, ii, 1-2)