In all likelihood, you might need multiple insurance policies. One of the most common that business owners start out with is the business owner’s policy or BOP. What is a BOP insurance policy? The great thing about BOP insurance is that it combines both your business property and business liability into one insurance policy.
Not every business is going to benefit from having a business owners policy. First off, businesses need to have a physical location. This can be your home, office, store, or any other physical address. Having a PO Box and running the business online isn’t bad, but a BOP probably won’t be the best policy for you. Another reason one might have a BOP is if there is a possibility for the business to be sued. This can happen if an employee or customer was injured at the location of your work. Lastly, business owners should consider a BOP if there are assets that could be stolen or damaged. This can be anything from digital assets, like customer data, to physical assets like furniture, equipment, or cash.
A BOP usually includes commercial property insurance, general liability insurance, and business income insurance. Commercial property insurance means that the property your business works out of is protected. Things like your building, equipment, inventory, and fixtures would be covered when there is damage from disaster or theft. It also provides coverage for your loss of accounts receivable and any valuable records you keep on sight.
General liability insurance is typically fairly broad under a BOP, which is actually more beneficial than you may originally think. The BOP protects your business when it is being sued for causing harm to a person or damage to a property. Legal fees could bankrupt a business, and sometimes lawsuits are completely unwarranted. A business owners policy should cover the cost of your defense, which could save you hundreds of thousands of dollars if the lawsuit went to trial.
On the other hand, a BOP also helps to cover the cost of your operations if there is a suspension in your work. Making payroll and continuing your financial obligations is tough when business ceases, but a BOP can help cover the loss of income so that you do not go under on your financial obligations.
What is a BOP insurance policy? A BOP isn’t going to be the end all to your insurance policy. While it is a great asset and starter coverage, you’ll most likely need additional policies to make up in coverage where the Business Owner Policy fails. For example, if you have employees, you’ll need things like worker’s compensation and health and disability insurance. BOPs do not cover professional liability or auto insurance, which is another thing to consider. Any of your professional services, vehicles, and things pertaining to your employees is going to need separate insurance policies.
We hope this article on what is a BOP insurance policy? has been informative. BOPs are meant to cover small businesses, but they’ll also stay with you during expansion. What’s great about the policy is that it can cover up to five different locations. This insurance policy is easy to get, and it can protect your business from harm during events you cannot control. Business owners can also rest easy knowing that a business owners policy won’t put them out of business in cost. These insurance policies can cost as little as $50-$100 a month, and their benefits are worth it.
