Hawaii Insurance Adjuster License Practice Exam

Which type of insurance would typically address loss of rental income?

1. General Liability Insurance

2. Business Interruption Insurance

3. Property Insurance

4. Health Insurance

The correct answer is: Business Interruption Insurance

Business Interruption Insurance is specifically designed to cover lost income that a business suffers due to a disruption in its normal operations caused by a covered event, such as property damage from a fire or natural disaster. This type of insurance can be particularly important for property owners or landlords who rely on rental income. If a property becomes uninhabitable due to a covered incident, business interruption insurance can provide compensation for the income that would have been generated during the period of restoration. While property insurance typically covers the physical damage to property itself, it does not specifically address the loss of income that may occur if that property cannot be rented. General Liability Insurance deals with legal liabilities to third parties, protecting the business from claims resulting from injuries or damages, but does not cover income loss. Health Insurance is focused on medical expenses and health-related costs for individuals, completely unrelated to rental income or business operations. Thus, Business Interruption Insurance stands out as the correct answer for addressing the specific scenario of loss of rental income.