Civil authority coverage

Civil authority coverage is the answer to a specific and fairly common situation: your building is fine, but the authorities will not let anyone near it. It extends business income coverage to the period when a government order prohibits access to your premises, and it typically requires that the order was issued because of physical damage from a covered peril at a property near yours.

The limits inside the extension are where people get caught. Policies usually attach a distance requirement, meaning the damage that triggered the order has to have occurred within a stated radius, and a time limit, often measured in weeks rather than months. There is also frequently a waiting period before payments begin.

The distinction that matters most is between an actual order and an inconvenience. Customers avoiding your block because it smells like smoke is not a civil authority trigger. A written order from an authority with the power to prohibit access, issued because of qualifying damage, is. If your business sits near an airport, a port, a stadium, or anywhere that gets cordoned off when something goes wrong, this extension deserves a real look rather than a glance.

Related terms

This page is education, not advice. Policy language varies by carrier, form, and state, so confirm how your own program is written with a licensed insurance professional.