What is not a typical feature of business interruption policies?

Business interruption policies are designed to help businesses recover lost income and cover ongoing expenses when they are unable to operate due to specific covered events, often involving physical damage. The key features of such policies include a specified indemnity period, which is the duration of time that the policy provides coverage after a loss occurs.

The correct answer indicates that the indemnity period is limited by the policy expiry date, which is not a typical feature of these policies. Generally, business interruption insurance specifies a defined indemnity period that commences from the date of the loss and lasts for a certain number of months or until the business is restored to its previous level of activity, up to the limit outlined in the policy. Therefore, the indemnity period is not typically tied to the expiry date of the policy itself; rather, it depends on the terms outlined in the policy regarding the duration of coverage after a loss.

Additionally, business interruption policies indeed cover future profits, as they aim to compensate businesses for lost earnings during the recovery period. They also provide coverage primarily for physical damage that leads to business interruption, reinforcing the importance of physical damage in triggering policy benefits. Therefore, the concept that the indemnity period is limited by the policy expiry date does not align with standard practices and principles