What specific, non-obvious trigger condition must typically be met for Contingent Business Interruption (CBI) coverage to activate, beyond mere disruption at a key supplier?

The specific, non-obvious trigger condition that must typically be met for Contingent Business Interruption (CBI) coverage to activate, beyond mere disruption at a key supplier, is that the key supplier must sustain direct physical loss or damage caused by a peril that would be covered under the insured's *ownproperty insurance policy, had the loss occurred at the insured's premises. Contingent Business Interruption (CBI) coverage provides financial protection for an insured company's loss of net profit and continuing expenses resulting from an interruption to their business operations caused by physical damage at a third-party location, such as a critical supplier, customer, or leader property. A 'key supplier' refers to an upstream entity whose products or services are essential for the insured's operations. The critical condition specifies that it is not enough for the supplier simply to experience a disruption, such as a labor strike, a sudden material shortage, or an economic downturn. Instead, the supplier's facility must suffer 'direct physical loss or damage,' meaning tangible, material harm to their property. This physical damage must then be attributable to a 'covered peril,' which is a specific cause of loss, such as fire, explosion, or windstorm, that is listed as covered or not excluded within the insured's own primary property insurance policy. For instance, if the insured's policy covers damage from fire, and their key supplier's factory burns down, CBI coverage might activate. However, if the supplier's operations are disrupted because a key machine broke down due to mechanical failure, and mechanical breakdown is not a covered peril under the insured's policy, then CBI coverage would typically not apply. The nexus is thus between the *typeof physical loss at the third party and the perils *insuredagainst by the policyholder's own policy.