What type of insurance policy could help a property owner protect against financial hardships associated with restoring a damaged income property?

Business Interruption Insurance is designed specifically to cover the loss of income that a property owner may experience as a result of damage to an income property. This type of insurance helps to mitigate financial hardships by providing compensation for lost revenue during the period when the property is being repaired and is unable to generate rental income. It addresses the critical need for property owners to maintain cash flow, ensuring that they can cover expenses such as mortgage payments, property taxes, and maintenance costs even when their property is non-operational due to damages.

Liability Insurance primarily covers legal costs and damages associated with claims made against the property owner for injury or property damage caused by the owner’s negligence, rather than the income directly tied to the property. Property Damage Insurance focuses on covering the physical damage to the property itself but does not provide compensation for lost income resulting from that damage. Personal Property Insurance typically covers the owner’s personal belongings, rather than the income-generating aspect of real estate. Thus, Business Interruption Insurance is the most appropriate choice to protect against financial hardships related to restoring an income property.