Question

XYZ Carpet Manufacturing's main factory burns down during the night due to faulty electrical wiring. No longer able to manufacture carpeting, XYZ Carpet faces a serious cash flow dilemma. Which insurance coverage might help pay XYZ Carpet's bills while the factory is repaired?

A. Business Income coverage
B. Control of Property coverage
C. Preservation of Property coverage
D. Builders Risk coverage

Answer 1

Business Income coverage is the insurance coverage that might help pay XYZ Carpet's bills while the factory is repaired.

Step-by-step explanation:

The insurance coverage that might help pay XYZ Carpet's bills while the factory is repaired is Business Income coverage. This coverage is designed to compensate a business for lost income and extra expenses incurred as a result of a covered loss, such as the fire that damaged XYZ Carpet's factory. It helps cover ongoing expenses such as payroll, rent, and utilities, and can also provide funds to help the business get back on its feet and cover any lost profits during the repair period.