Calculator Inputs
Enter normal monthly values, interruption assumptions, and policy settings. Results appear above this form after calculation.
Example Data Table
| Average Monthly Revenue | Interruption Revenue | Gross Margin % | Indemnity Days | Estimated Loss Before Deductible | Estimated Recoverable Loss |
|---|---|---|---|---|---|
| $120,000.00 | $30,000.00 | 42.00% | 90 | $170,744.75 | $165,744.75 |
This example assumes a 3-day waiting period, 15% mitigation recovery, 110 seasonal index, $18,000 continuing expenses, $3,500 saved expenses, $6,000 extra expenses, and an $800,000 limit.
Formula Used
1. Adjusted baseline revenue
Adjusted Baseline Revenue = (Average Monthly Revenue + Other Monthly Income at Risk) × Seasonal Index
2. Monthly revenue gap
Monthly Revenue Gap = Adjusted Baseline Revenue − Revenue During Interruption
3. Mitigated revenue gap
Mitigated Revenue Gap = Monthly Revenue Gap × (1 − Mitigation Recovery Percentage)
4. Gross profit loss
Gross Profit Loss = Mitigated Revenue Gap × Gross Margin Percentage × Covered Months
5. Expense impact
Continuing Expense Loss = Continuing Monthly Expenses × Covered Months
Extra Expense Loss = Extra Monthly Mitigation Expenses × Covered Months
Saved Expense Offset = Saved Monthly Expenses × Covered Months
6. Pre-deductible loss
Estimated Loss Before Deductible = Gross Profit Loss + Continuing Expense Loss + Extra Expense Loss − Saved Expense Offset
7. Recoverable estimate
Loss After Deductible = Estimated Loss Before Deductible − Deductible
Insurance to Value Ratio = Policy Limit ÷ Required Insurance Limit
Estimated Recoverable Loss = Smaller of (Loss After Deductible × Insurance to Value Ratio) or Policy Limit
This calculator gives an analytical estimate. Actual policy wording, sublimits, payroll treatment, dependent property clauses, waiting periods, and extensions can change recoverable amounts.
How to Use This Calculator
Enter your normal monthly revenue before the interruption starts. Add any other monthly income streams that would also be affected.
Estimate how much revenue you can still generate during the interruption. This may include partial operations, online sales, or outsourced production.
Enter your gross margin percentage. Then add monthly continuing expenses, such as rent, insurance, debt service, or salaried payroll that will continue.
Enter saved monthly expenses that stop during downtime. Add extra monthly costs spent to reduce the loss, such as temporary facilities or emergency outsourcing.
Use the mitigation recovery percentage to reflect revenue regained through workarounds. Apply a seasonal index above 100 for peak periods or below 100 for slower periods.
Set indemnity days, waiting period, deductible, policy limit, and coinsurance percentage. Press Calculate Loss to show the results above the form.
Use the export buttons to save a CSV summary or a PDF version of the results section for internal review or claim support files.
FAQs
1. What does this calculator estimate?
It estimates business interruption loss from reduced revenue, continuing expenses, saved costs, extra expenses, waiting periods, deductibles, and a simplified coinsurance check.
2. Should I use gross margin or net profit?
Use the margin definition that matches your policy wording. Many claims rely on gross profit or contribution margin rather than bottom-line net profit.
3. What are continuing expenses?
These are costs that continue during the shutdown, such as rent, taxes, insurance, debt service, utilities minimums, and key payroll commitments.
4. Why are saved expenses subtracted?
Some expenses stop when operations stop. Those avoided costs reduce the net interruption loss and are commonly deducted in claim calculations.
5. What is mitigation recovery percentage?
It reflects revenue restored through temporary measures, alternative suppliers, overtime, outsourcing, or relocation. Higher recovery means a smaller estimated loss.
6. How is the waiting period handled?
The waiting period is deducted from the indemnity period. Only the remaining covered days are converted into covered months for the estimate.
7. Does this replace a formal insurance claim review?
No. It is a planning and screening tool. Formal claims need policy wording, accounting support, mitigation documentation, and insurer or expert review.
8. Can I use this for scenario analysis?
Yes. Change downtime, seasonal index, mitigation, revenue during interruption, and policy settings to compare best-case, expected, and worst-case outcomes.