A business owners policy, or BOP, combines certain coverages into a single policy that’s typically more affordable for small businesses than purchasing separate coverages. There’s often confusion in what a BOP covers, however.
A basic BOP includes:
-
Property Insurance: This covers physical buildings and their contents in the event of fire, smoke, lightning, wind, hail, theft or vandalism and more.
-
Business Interruption Insurance: In the event a disaster makes it impossible to operate, business interruption insurance helps cover the income lost while business operations are put on hold. It can also help with the cost of moving the business to a temporary location.
What Does a Business Owners Policy Not Cover?
BOPs don’t cover:
-
Auto Accidents: If your business operates with the use of owned or borrowed vehicles, you will need commercial auto insurance. Commercial auto insurance provides coverage for a range of accidents for work vehicles. It typically includes comprehensive, collision, personal injury protection, uninsured/underinsured motorist and liability coverage.
-
Workers Compensation Coverage: Workers compensation insurance steps in if an employee is injured while on the job. It can provide compensation for medical expenses, disability and lost income.
Small businesses often invest in BOPs because, while not very flexible, they’re often affordable and provide crucial coverage. The average cost for a BOP is about $1,200 a year, which is only about $100 a month. On its own, the average cost of general liability insurance can be as much as $2,758 a year.
Costs for a BOP depend on a variety of factors, such as:
-
Credit score
-
Claims history
-
Coverage limits
-
Location
-
Business experience
For larger businesses, there is a policy package available that’s more expensive but offers more flexibility in coverage. This is a commercial package policy. It includes everything in a BOP, but allows you to add more coverage.
Contact Lone Star Insurance Agency to learn more about our business insurance coverage options, or to get started on your free quote!