Business Owners Policy (BOP)

What Does Business Owners Insurance Cover?

A Business Owners Policy (BOP) combines several essential coverages into a single, convenient package. Here are the core coverages included in most BOPs:

• General Liability: Covers third-party claims of bodily injury, property damage, and advertising injury. This is similar to standalone General Liability Insurance, but packaged for cost efficiency.
• Property Insurance: Protects your building, equipment, inventory, and other assets from covered events like fire, theft, and vandalism. For businesses with specific property needs, consider also adding Commercial Property Insurance.
• Business Interruption Insurance: Provides financial support for lost income if your business operations are disrupted due to covered property damage. This is crucial for maintaining stability in the face of unexpected events.
• Cyber Liability (Optional): Protects against data breaches and cyberattacks, covering costs associated with data recovery and legal expenses. If cyber threats are a primary concern, consider combining with a dedicated Cyber Liability Insurance policy for additional protection.
• Equipment Breakdown: Covers repairs or replacement costs if critical equipment fails unexpectedly, ensuring you can get back to business quickly.
• Inland Marine Insurance: Protects mobile tools, equipment, and products while in transit or stored off-site. For more specific needs, see our Inland Marine Insurance options.

If your business requires a license to operate, such as contractors, auto dealers, or other regulated industries, you may also need specific types of bonds to meet legal and licensing requirements. License Bonds ensure that your business complies with local, state, or federal regulations. Additionally, if your business involves public projects, Performance Bonds and Permit Bonds may be necessary to guarantee your contractual obligations.

Why Choose a Business Owners Policy?

• Convenience: Combines multiple essential coverages in a single, streamlined policy. This eliminates the need to manage separate policies and simplifies coverage for small and medium-sized business owners.
• Affordability: Offers cost savings compared to purchasing separate policies. Bundling coverage through a BOP is often much more cost-effective than purchasing individual insurance products like General Liability and Commercial Property Insurance separately.
• Flexibility: Customizable to address industry-specific risks and unique business needs. You can add optional coverages like Employment Practices Liability Insurance (EPLI) to cover workplace claims, or Errors & Omissions (E&O) for professional service protection.
• Peace of Mind: Helps you recover quickly from setbacks, minimizing disruption to your business. This ensures that your employees and customers are not adversely affected by sudden losses.

A BOP also pairs well with other specialized coverages. For example, adding Workers' Compensation Insurance will ensure that employee injuries are covered while maintaining your general liability and property protection.

Typical Coverage Limits for a BOP

• General Liability Coverage: Typically offers coverage up to $1,000,000 per occurrence and $2,000,000 aggregate for bodily injury, property damage, and personal/advertising injury claims.
• Property Insurance Coverage: Covers up to the replacement value of your building, equipment, and inventory. Limits depend on the value of your assets and the level of coverage selected.
• Business Interruption Coverage: Provides compensation for lost income and operating expenses for up to 12 months or more, depending on the policy.
• Equipment Breakdown Coverage: Coverage limits vary based on the type of equipment and potential replacement costs.
• Inland Marine Coverage: Typically provides coverage limits based on the value of tools, equipment, and goods in transit.

Examples of BOP Claims

A Business Owners Policy (BOP) can cover a variety of real-world situations, such as:

• Fire Damage: Your retail store suffers fire damage, and you need repairs to the building and replacement of lost inventory. Property Insurance within the BOP helps cover these expenses.
• Slip and Fall Injury: A customer slips on a wet floor in your business, leading to medical expenses and a potential lawsuit. General Liability Coverage helps pay for their medical expenses and your legal fees.
• Business Interruption: Your restaurant is damaged by a storm and must close for several weeks. Business Interruption Insurance compensates you for lost income and ongoing expenses during the closure.
• Cyber Attack: A small breach exposes customer data, and you need to hire a cybersecurity consultant to mitigate the damage. Cyber Liability (if added to your BOP) can help cover these costs.

To ensure complete coverage, you might also consider adding a Commercial Umbrella Policy, which provides additional limits over and above those offered by your BOP.

Getting a Quote for Business Owners Policy (BOP)

Frequently Asked Questions

• What types of businesses are eligible for a BOP? Small and medium-sized businesses across many industries, such as retail, restaurants, and offices, are typically eligible.
• How does business interruption insurance work? It covers lost income and operating expenses if you’re forced to close temporarily due to covered property damage.
• Is cyber liability coverage included? Cyber liability is usually optional and can be added to cover data breaches and cyberattacks.
• Do I need bonds if my business is licensed? Yes, if your business requires a license, you may need specific bonds like License Bonds to comply with legal requirements. Additionally, Performance Bonds or Permit Bonds may be required for specific projects or contracts.