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Business Interruption Insurance for Manufacturers: What CFOs Need to Know
Manufacturing Minute
On this episode of The Manufacturing Minute, host Megan Meador (Audit & Assurance Partner and Manufacturing & Distribution Practice Leader at Brown Edwards) sits down with John Pendleton, Vice President and Property & Casualty insurance expert at Scott Insurance, to unpack business interruption coverage for manufacturers. John explains what triggers business interruption claims — from fires and tornadoes to cyberattacks and ransomware — and breaks down the three main things this coverage can subsidize: lost net income, payroll, and extra expenses. He walks through how manufacturers should calculate the right coverage limits using a business income worksheet (and why it should be revisited annually, not every few years), and shares practical steps for building a disaster recovery plan, including assembling a crisis management team, mapping supplier and equipment lead times, and organizing documentation before disaster strikes. John also shares a real-world story of guiding a manufacturing client through a $3 million claim after a direct tornado hit, offering listeners a candid look at what recovery really looks like when the unexpected happens.
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