Starting a business can be an exciting venture that requires both time and energy. But along with the thrill of creation comes certain risks. Fire, theft, and other hazards can quickly put the brakes on entrepreneurial dreams. Liability and lawsuits can also be potential threats.
To help offset these liabilities, many organizations consider obtaining a commercial property insurance policy and a commercial general liability insurance policy. However, purchasing two separate policies may be too costly for some businesses.
For these reasons, a Business Owner’s Policy (commonly referred to as a “BOP” or “BOP insurance”) may be a good option.
What Is BOP Insurance?
A BOP is an insurance package designed to help protect small to medium-sized businesses. BOPs typically offer business property, liability and business interruption coverage, combining commercial property insurance and general liability insurance into a single policy.
In addition to the convenience of combining these types of coverage, BOP insurance can also be less expensive than purchasing the coverages separately, depending on the coverage options selected.
What Does BOP Insurance Cover?
The terms, conditions and exclusions of a given BOP will vary but BOP coverage typically includes the following:
Commercial Property Coverage
Commercial property coverage helps protect a business from losses or damage to buildings, inventory, machinery, and other business property. Commercial property coverage can also help provide protection against extra expenses and loss of use due to a covered loss.
Commercial General Liability Coverage
Unfortunately, dealing with lawsuits can be a very real part of operating a business. Commercial general liability coverage (CGL) helps assist with the cost of lawsuits or claims brought against a business for bodily injury, property damage, or other covered losses. Some examples of types of lawsuits a BOP may cover include:
- Third-party bodily injuries
- Third-party property damage
- Product liability
- Advertising liability
BOP insurance typically has a combined limit for third-party bodily injury and third-party property damage. Some small business owners opt to have a standalone CGL policy instead of a BOP. Learn more about the difference between a BOP and Commercial General Liability.
Business Interruption Coverage
The cost of getting a business back to fully operational capability after a covered event isn't the only cost a business owner needs to worry about. Business interruption coverage typically helps cover a business's operating expenses while it's being repaired or rebuilt after a covered loss.
Medical Payments Coverage
Medical payment coverage typically covers medical expenses for individuals who are injured on the business's property or as a result of the business's operations. This coverage can help protect the business against financial liability and can help cover medical care costs.
Other Options
When it comes to insurance, different businesses have different needs. To help meet these needs, some insurance providers offer other optional coverages to be added to a BOP, like product liability coverage. Specialized coverage options can better help protect some businesses, depending upon its specific needs. Contact us at Acrisure to learn more.
What Types of Businesses Could Benefit from a BOP?
BOP insurance is a common choice for business owners who prefer to combine liability and property coverages into one policy. This may be a less complicated or less expensive alternative to purchasing the same coverages separately. Although eligibility can vary between insurance providers, in general, to be eligible for a BOP, a business typically:
- Employs fewer than 100 employees
- Generates $5 million or less in annual revenue
- Operates out of a single small office or workspace
- Represents lower risk in general
Depending on the circumstances of the specific business, the following are examples of industries that may be eligible for a BOP:
- Retail stores
- Restaurants
- Small manufacturers
- Salons
- Contractors
How Much Does BOP Insurance Typically Cost?
Many factors help determine the price of insurance coverage for a business including, for example, industry, location, and the value of the property. Because each policy will vary depending upon the insurer, the specific businesses needs and any customization, it can be challenging to provide an accurate cost estimate. However, in general, it can be more cost effective to purchase a BOP rather than purchasing commercial property and commercial general liability insurance separately.
Contact Acrisure to Learn More
There are various potential risks associated with operating a small business, and that's how business insurance can help. Acrisure can help simplify the small business insurance process for you. BOPs combine some of the most common business coverages conveniently for you so you can focus on growing your business.
Ready to match your insurance coverage to your business needs? Request a small business insurance quote today!