Business Interruption Insurance
Various Aspects

If stopping your company activity is not an option, say during 3-month to recover from a disaster; then you should consider business interruption insurance.

Business Interruption Insurance gives you cash to continue business while you rebuild

After a disaster, if you can’t afford to interrupt your business, you should consider buying Property & Business Interruption insurance. The case of Covid19 declared pandemics on BI indemnity.

Due to massive frauds, Business Interruption Insurance terms change by the year!

Keep your staff and your business open after a factory disaster.
Property insurers are more reluctant to sell Business interruption insurance. It is not unusual for ailing businesses to fraud by purchasing insurance business interruption, then set ‘accidental fire’ to the premises.
With the Covid19 pandemic, restaurants, hospitality businesses and factories actioned Business Interruption insurance. How does it work? The accidental business interruption can be a fatal risk, though rarely happens, that ruins companies. The easy protection is Business Interruption insurance to pay for disaster recovery costs. The coverage that provides immediate cash to help run ‘business as usual’ while you rebuild. Can you afford to stop business for say 3-month or more to rebuild your premises; meanwhile, no sales, no income to pay for rental and fixed costs, staff leaving the company…

Keep your profits and business performances during disaster recovery period

Business interruption insurance keeps your business uninterrupted whatever the catastrophe happens. For most companies, an interruption of 6-month (3 for rebuilding and 3 to get back on foot), means losing all clients: food deliveries, infrastructure supply - think web hosting center, industry subcontractors of spare parts. You can get insurance for the fixed costs repayment but also the average monthly profit you generate… Assuring not an only survival but also maintaining growth and investment so you don't incur time loss is especially important to stay in the race in a growth sector.

Business Interruption Insurance in Vietnam

Business interruption insurance is fairly common in western countries as the risk and costs. 

1. The causes are fairly limited: fire and natural catastrophes

2. The benefits are: a duplication of the average costs/ revenue of your business

3. The proof and claims procedure: showing past year audited accounts


In Vietnam, all 3 straightforward conditions are revised constantly, mostly due to insurance frauds and abuses in Vietnam. The most common is ailing business would burn down their factory -having displaced valuable assets beforehand- to collect insurance money to build a brand new factory and live on for 3-to-6 months 

As insurance laws do not exist, therefore the written contract between the insurer and the client becomes binding. 

Unfortunately most contracts are largely man-made out of little experience and tailormade to the risk each insurer is ready to take.

Recently, as Covid19, a pandemic has for decades been deemed uninsurable as an ‘Act of God’, as it is declared by the WHO, turning the risk to governments would become the supreme insurer to indemnify losses.

Some insurers in Vietnam would sell a policy to make a sale; taking the premium and hoping the catastrophe will not happen, always ready for the upside but not the downside.

Our experience is to assess the economic and practical aspects of business interruption with the Vietnam insurer. A bit similar to an recruiting interview, we would check: 

– How strategic is it to the insurer

– What experience they have

– How the clients claims were handled

– What capital is allocated to losses or re-insured to whom?

Our 5-criteria screening: Security | Benefits | Flexibility | Costs | Admin Claim

Specifically for Business interruptions coverage, we will review:

CAUSES: confirm he list of covered causes and exclusions

BENEFITS: needed by clients vs acceptable by the insurer

CLAIMS: procedure and documents requested, being the most important


NB. Good insurers in Vietnam are very ‘conservative’ and in doubt or ignorance, they would not accept to do business. On the contrary, bad insurers would readily accept to sell you insurance for your premium with the hope the catastrophe will not happen to you, knowing they can mitigate their payment. Not very ethical for a State-owned insurer but our job is to figure out what Warren Buffett says “It is when the tide recedes that we can see who has been bathing naked”.

insurance in Asia

Not only health insurance is different but most general insurance: accident, life, home, travel, office or even car insurance will be different than your past experiences.