A business owner’s policy, known as a BOP, can provide “package” protection against an array of risks — for a premium that’s significantly lower than the cost of the individual property and liability policies that you would need to cover all of these perils.
Imagine the following costly scenarios:
- One of your staff embezzles $80,000 from your company.
- A visitor to your office slips and falls after the floor has been mopped, breaking his leg.
- There’s a fire in your warehouse that damages half of your $2 million inventory.
As a small business owner, you would likely be reeling if any of one of these happened to you as you’d be looking at a significant financial hit. Would you be surprised to know that a single insurance policy could pick up the tab for any of these occurrences?
As a rule, BOP packages are available to Main Street businesses. Those are businesses with revenues of $5 million or less and 100 or fewer employees.
What are the main coverages
Property coverage under a typical Business Owner’s Policy includes:
- Damage to your premises, contents, inventory, office equipment, and computers, as well as the property of others that’s temporarily in your care. Most BOPs will pay for the cost of replacing lost or damaged property, rather than its actual cash value.
- Business interruption covers loss of income to your business caused by lost or damaged property. A business owner’s policy liability coverage includes, but is not limited to:
- Bodily injury. This covers losses due to physical or mental injury, disease or death that occurs on your premises or is caused by your products.
- Medical payments. This portion of the BOP picks up the cost of health care treatment for customers, vendors or suppliers injured on your property.
- Personal and advertising liability. This protects your business against lawsuits alleging slander, libel or invasion of privacy.
- Crime. This section covers loss of money or securities from burglary, theft and embezzlement.
You need to know that the amounts of insurance (limits) under your business owner’s policy are fixed. Based on that, you need to evaluate your policy to see if you need to increase your limits. You may need to add coverage, such as fleet auto and additional coverages depending on your needs and the industry in which you operate.
Also, workers’ compensation coverage is not typically covered by a BOP and you would need to secure a separate policy.
You need a BOP that’s tailored to the needs and the budget of your business. Call the office today to discuss all of the options available to you to protect your business.
