What is a Business Owner Policy?

A business owner’s policy, commonly referred to as a BOP, is a special type of business insurance offering designed specifically for small- to medium-sized businesses. It bundles two of the most common insurance types – general liability and commercial property – into one. This provides business owners like you with a more convenient and affordable option than purchasing separate policies from the same or different carriers.

A BOP helps protect you, your business and your property from a wide range of risks including fire, theft, lawsuits, disasters and loss of income. The general liability insurance coverage part protects against claims of bodily injury, personal injury, advertising injury and property damage caused by the business owner or employees. Because general liability does not cover the business property itself, you may need commercial property coverage too, which is the second coverage part of a BOP. This protects your business’ buildings (owned, rented and in-process construction) and business personal property. It also often includes business interruption insurance, which replaces lost income if operations are forced to shut down following a covered event.  

In addition to a standard BOP, many insurance carriers offer optional customizations for business owners to create the policy that best suits their needs. Some common examples include coverage for specific crimes, computer equipment, electronic data loss, employee dishonesty and terrorism. 

While BOPs combine two of the most important coverages a business can have, they are not available to every business and do have eligibility requirements often related to business type, location, size and revenue. 

Why do I need it?

You should consider a BOP if your business has a physical location with property that could be stolen or damaged including equipment, furniture, inventory, cash or digital assets. Typically, companies with 100 employees or less and revenues of up to $5 million are BOP candidates, but policies can be custom fit for any industry or size. Your agent can work with you to find and secure the right BOP to protect you and your business.

How much does a BOP cost?

BOP costs vary widely based on your business’ size, industry, location and amount of coverage you need. Because it is a single policy that covers your most common risks, it is more affordable than purchasing general liability insurance and commercial property insurance policies separately from the same or different carriers. BOPs can also be customized to support nearly any business profile. Your agent can help you tailor the right coverage mix for both your risks and your wallet. 

What kind of coverage do I need in a BOP?

BOPs include two of the most important coverages a business can have – general liability and commercial property – but there are many standard and custom options available to suit your unique business. Some tailored options include liquor liability insurance, electronic data loss insurance, terrorism and more. Business owners should work with their agents to review policy terms and costs to identify the most ideal BOP option.

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