Business Owners Policy

What is a business owners policy?

Also referred to as a BOP, a Business Owners Policy combines the coverage of business property and business liability under one policy for maximum convenience. An added advantage is that these policies can be tailored to fit your company’s needs. You can add optional coverage for other unforeseen risks, such as data breaches and professional liability (also known as errors and omissions).

By combining two types of coverage into one policy, businesses can simplify their processes and paperwork and also save money on their coverage.

What does it cover?

  • Commercial Property Insurance: Any buildings, structures, and property owned by your business would be covered under this policy. This includes your office building or factory, equipment, furniture, and any fixtures. Paperwork and data are also included in this clause.
  • General Liability Insurance: This coverage is all-encompassing and includes things like bodily injury, damage to third-party property, personal injury, advertising injury, electronic data liability, medical expenses, defense costs, the actions of employees, and supplemental payments. Coverage also extends globally in most cases.Keep in mind that General Liability Insurance does not cover workers comp claims. You must have Workers Compensation Insurance for coverage to apply for any work-related illnesses or injuries sustained by your employees.
  • Business Income Insurance: If you have to temporarily cease operations due to a covered cause of loss like a fire or third-party injury claim, a BOP will assist you by replacing lost income so that you can meet your financial obligations, including staff payroll and rent.
  • Other (Optional) Coverage: The flexibility of a Business Owners Policy allows you to add coverage as needed, depending on your business and the risks you face. Here are some additional types of coverage to consider:
    • – Data Breach Coverage – Media stories of companies falling victim to data breaches are becoming increasingly commonplace. Even corporate giants like Target, Yahoo, Uber, and JP Morgan Chase have experienced wide-scale data breaches within the past few years.
    • If your business handles or stores any private customer or employee information, you are potentially at risk and should have coverage in the event that there is a breach. You could be held financially liable and sued for damages for a data breach, even if it wasn’t your fault.
    • In addition to providing coverage to assist with damages, you’ll also receive guidance on how to prevent breaches and advice on best practices in managing them if they do occur.
    • This coverage would help with the following if a data breach occurs:
      • Replace income and cover expenses if your company has to halt or slow operations.
      • Protect your business even if the breach occurred before you had a policy.
      • Pay ransoms and extortion fees if there’s a threat of a breach.
    • – Professional Liability (Errors and Omissions) Coverage – Business owners are at risk every day because they have to use judgment and their subjective experience to provide services. If you’re a business owner or service provider, you can be sued for negligently performing services even if you haven’t made a mistake. You can protect your business by adding Professional Liability Insurance, also known as errors and omissions insurance (E & O insurance) or professional indemnity insurance to your policy.

Other necessary coverage that’s not part of a business owners policy

Despite the comprehensive coverage provided by a Business Owners Policy, there are still other types of Business Insurance that you should consider carrying to protect yourself, your assets, and your business.

  • – For Businesses with Employees: Workers Compensation Insurance is mandatory in many US states. This is vital insurance to have as it pays damages for any employees who sustain a work-related injury, illness or fatality. Not only does it cover medical payments, but it also provides an employee’s income while they are off work. Even if your employees don’t do physical labor, they could still be badly injured from a slip, fall or repetitive movement injury (i.e., carpal tunnel syndrome).
  • – For Businesses that Own, Rent or Lease Vehicles: Commercial Auto Insurance is necessary if you have any company vehicles. If you or your employee are found at fault in an accident, this coverage protects you from devastating financial losses.

Items not covered by a business owners policy

Although this type of Business Insurance covers a wide array of circumstances, it’s crucial also to take note of what’s not covered in this plan. Here’s an overview of items that would require a separate policy:

  • Professional Errors: This coverage would fall under the umbrella of Professional Liability Insurance.
  • Employee Injuries: As noted earlier, if an employee is injured on the job, Workers Compensation Insurance would be necessary to provide coverage.
  • Employee Discrimination Suits: Again, this suit would be covered under the Professional Liability umbrella.

Does my company need it?

Every business can benefit from a BOP as the peace of mind it offers, and the coverage it provides can make the difference between a company surviving a claim or disaster or having to shut down entirely.
Because a Business Owners Policy protects both property, people, and your business itself, it is advisable to consider carrying it if any of the following apply to your situation:

  • – Your company has a physical location, even if that location happens to be your home
  • – There’s any chance that you can be sued, whether from a customer who was injured at your location or a client who wants to file an advertising injury claim
  • – You have any valuable assets that can be damaged or stolen. The assets could be physical like furniture, equipment, and inventory; or they could be digital assets like graphics, presentations or customer data.

Claim examples – How the coverage works

Not all claims have to do with bodily injury, negligence or disaster.

If you manufacture a product, you could also be held liable if it’s found to defective. For example, your company might make iPhone chargers. If a batch is faulty and a customer’s phone explodes or catches fire when they plug it in, the customer could sue you for the cost of replacing the phone and any damages to their home. In addition to paying these expenses, your BOP would also cover the legal costs.

Another example of a claim would be theft at your facility. Perhaps you have an office with about 20 employees. One night, a thief breaks in and steals all of the computers, the projector in your conference room, and other office equipment. Most BOPs come with commercial property insurance, which would cover the replacement costs of the equipment as well as the damage to the building sustained by the break-in, such as broken windows, etc.

Why Click2bind for your business owners policy?

As an independent agency, we have access to multiple carriers. We do all the research and comparison shopping for you, helping you lock in the most competitive prices while getting a plan that best fits your needs. We take a data-driven approach to find the perfect policy so that you have the coverage you need without paying for the things you don’t.

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