What type of loss would typically be covered by an Extra Expense Policy?

An Extra Expense Policy is specifically designed to cover the additional costs that a business incurs to continue its operations after a loss that interrupts their normal business activity. This type of insurance is crucial for businesses that cannot afford to halt operations or that would suffer significant financial losses if they did so.

In the event of a covered peril that disrupts operations—like a fire or natural disaster—an Extra Expense Policy helps cover the increased costs such as temporary relocation, expedited shipping for materials, or overtime expenses for employees to maintain continuity of service or production. The focus here is on ensuring that a business remains operational despite the constraints posed by the loss, ultimately mitigating its financial impact.

The other options refer to different types of losses or coverage. Loss of inventory would fall under property insurance, while loss of market share is more related to competitive positioning and not an insurable event. Damaged property valuation involves determining the amount of loss for property damage claims, rather than covering additional expenses incurred to keep a business running. Thus, the choice that aligns with the purpose of an Extra Expense Policy is related to costs incurred to continue operations after a loss.