I'm not sure if anyone on JU owns a real estate company that owns buildings and rents them out, but if you do, you probably have business interruption insurance to cover loss of rents.
You may remember from my last article that BI insurance only kicks in when there is property damage of some kind. So people moving out is NOT a loss of rents claim.
The most important things in a loss of rents claim are the lease agreement and the availability of units for tenants to relocate to. If every unit in a building rents for the same amount, and there's usually a 50% occupancy rate, and half the units are damaged/untenantable, then there is probably no loss of rents claim, as the tenants in the damaged side can move to the other side, and rents still collected as normal. Whether or not they DO move there is not relevant. It becomes a coverage question at that point and is up to the adjuster. From the accountant's standpoint, there is no loss.
So, the only time a BI claim will be successful is when the relocated tenants are now paying less rent, or if the building/complex runs out of empty rooms to put people in.
At that point, it's easy to see the lost revenue, and only the discontinuing expenses need to be taken into consideration. If the company stops paying utilities for those rooms, if a security guard gets let go because there's no need to patrol that building while it's damaged, or any other expenses stop, it gets deducted from the lost revenue. Sometimes these are hard to find if the area affected is very small.
The lease agreement is important because it specifies what can be done by either party in the event of damage, and if rent stops(abates) for any period of time. In my vast experience(ha) it seems that residential buildings are more likely to allow cancellation of the lease or relocation, whereas business buildings, such as malls, allow abatement of rent until the store can be reopened. This is very important because if the lease says the rents abate, then it's a loss of rent, whether they could move or not. The lease is really the final say in it, apart from the adjuster.
Remember, though... every claim is different. Your policy may have different exclusions or coverages. I do not interpret policy, I just come up with a reasonable number based on the interpretations of the adjuster.