A business owners policy is an affordable and useful policy designed to protect small businesses from common dangers such as lawsuits and property damage. These policies are flexible, but all come with two basic pieces: general liability and commercial property insurance.
How It Works
Most businesses purchase general liability and commercial property insurance for their business. These insurance coverages don’t change when placed into a business owners policy (BOP) unless their coverages are adjusted to fit your business’ unique needs.
This means that normal coverage and exclusions are generally the same in a BOP as they are in an individual policy. A basic commercial property insurance policy covers the physical building (such as a store) and its contents from damage caused by:
Objects covered under this type of policy include the physical building, equipment, tables, fixtures, attached structures and more. You can also add coverage to compensate for losses of or damages to expensive equipment, arts and jewelry.
What is Not Covered Under a Business Owners Policy?
BOPs are subject to the same exclusions that commonly affect commercial property insurance. Many commercial property policies exclude coverage for flood and earthquake damage, though depending on your insurance provider, you may be able to add policies to cover these incidents.
Property coverage also often does not cover outdoor signs, unattached structures or landscaping.
Additional Property Insurance for Your BOP
Depending on your business and industry, you may need additional property insurance. Some property coverages you may be able to add to a BOP include:
- Business Interruption: Business interruption insurance may come as part of your BOP. This insurance offers compensation for monetary losses if the business is temporarily unable to operate due to disaster, government mandate or other unexpected incident.
- Debris Removal: While property insurance covers repairs, it does not always cover debris removal or clearing after a disaster. Debris removal coverage can provide compensation for debris removal services.
- Inland Marine: Inland marine insurance covers objects and equipment that are lost or damaged while in transport.
- Equipment Breakdown: Equipment breakdown insurance covers expenses if equipment owned or used by the business breaks down unexpectedly. So long as the incident isn’t caused by negligence or normal wear and tear, this insurance can help pay for repairs or a replacement.
Speak with your insurance agent about getting the right BOP for your business.