Understanding Your BOPArticle originally posted on www.insuranceneighbor.com(opens in new tab)
A business owners policy (BOP) combines protection from all major business property and liability risks in one convenient package. Package policies are created for small and mid-sized businesses that face the same type and degree of risk.
A policy that combines property and business liability insurance can cover your business for claims resulting from fire, theft, and other covered disasters, as well as for claims that could arise from business operations involving property damage, bodily injury, or personal and advertising injury.
A BOP can be custom-tailored to meet the unique needs of your business. Our experienced agency can work with you to add additional specialized coverage, such as data breach or business income for off-premises utility services, to your business owners policy.
Do You Need a Business Owners Policy?
Most businesses do need a BOP. Consider a business owners policy if:
- Your business has a physical location. This could be out of your home, an office you rent or own, a store, or any other workplace.
- Your business has assets that could be damaged or stolen. This applies no matter what type of assets they are – equipment, furniture, cash, inventory, digital assets, or customer data.
- A possibility exists of your business being sued. For example, a lawsuit could arise if a customer had a slip and fall accident or was otherwise injured on your premises.
What Is Included in a Business Owners Policy?
A BOP typically includes the following coverage:
- Commercial property insurance: This protects property your business owns, leases, or rents, including buildings, furniture, fixtures, equipment, and inventory. It also provides coverage for loss of accounts receivable and valuable records.
- General liability insurance: Business liability insurance covers your business in case a lawsuit is filed against the business claiming property damage or personal injury. It helps cover the cost of your defense and damages you may be required to pay if the company is found liable.
- Business income insurance: If unexpected events in a covered cause of loss result in suspension of your business operations, business income insurance helps replace the loss of income so you can meet your financial obligations, such as payroll and rent.
Tailoring a BOP to Your Specific Needs
You can add additional coverage to your business owners policy to suit the needs of your company. Our knowledgeable agency can help ensure that your business has the coverage it needs. Popular optional coverage includes:
- Data breach coverage: This added protection is advisable for any business that handles or stores private customer, patient, or employee information. If a breach occurs, data breach coverage can help pay for expenses associated with notifying individuals affected by the breach, credit monitoring services, and public relations damage control. It can also replace lost income if operations close or slow down because of the breach and pay any ransom or extortion expense associated with the threat of a breach.
- Professional liability coverage (Errors and Omissions): If you provide a professional service, you are open to customer or client claims alleging negligent acts, errors, or omissions. Professional liability insurance helps protect your business from this type of claim.