What is the primary role of extra expense insurance?

The primary role of extra expense insurance is to maintain operations after an unexpected event, such as a disaster or significant disruption. This type of insurance is designed specifically to cover the additional costs a business incurs to continue its operations in the aftermath of such incidents. For example, if a fire damages a facility, extra expense insurance can help pay for temporary relocation, rental equipment, or expedited repairs. This ensures that the business can minimize revenue loss and maintain continuity while working through the recovery process.

Other options do not align with the unique function of extra expense insurance. Securing business loans and funding legal fees do not relate to operational continuity but rather to financial aspects of business management, while insuring customer property pertains more to liability and property insurance rather than the extra expenses incurred due to operational disruptions.