For example, if a key supplier is shut down by a fire and can't deliver critical raw materials to a manufacturer, the manufacturer's business may be seriously interrupted. Property damage at a key customer's business may have the same effect. If you depend on one firm for most of your volume and that firm is forced to suspend purchasing, you will lose income. Every year hundreds of businesses that carry adequate insurance against direct property losses fail because they are not insured for indirect losses. Don't forget to protect your business against loss of income and unusual expenses that may result if indirect loss forces you to close temporarily.
Every business also faces exposure to liability losses.
Examples include A customer in a firm's building trips on a broken step. A defective product causes injury to its user. Improper installation of a product causes injury to a customer. A tenant is held responsible for a third-party injury occurring on the rented property, due to a clause he or she signed agreeing to such responsibility. Your daily paper will provide dozens of other examples.