Business Owner’s Policy

Business Owners Policy

A business owner’s policy is a type of business coverage that combines both liability and property coverage. BOP is commonly used by small and medium enterprises like wholesalers, restaurants, contractors, and retail stores.

The Three Primary Coverages


Property coverage provides coverage for commercial buildings and business personal property. Additionally, property coverage can sort other issues such a pollution cleanup, debris removal, and income loss as part of a covered loss.

Just like other insurance policies, a BOP has some exclusions. Thus, as a business owner, you should ask your insurance agent relevant questions to know losses that aren’t covered by your policy. For example, a BOP policy cannot compensate the damage caused by an earthquake. If your business is located in an earthquake-prone area, it is essential to add an endorsement to your BOP policy. Endorsement options extend your policy coverages.


Liability coverage included in BOP is similar to the general liability policy. This policy covers the business owners against liabilities such as advertising injury, property damage, bodily injury, and product-related injuries. It is prudent to note that BOP doesn’t cover losses of injuries to employees. The policy only covers injuries caused by your business property to third parties.

Business Interruption

Business interruption, also known as business income insurance, covers losses of revenues that occur because of an accident. For example, a business may be forced to shut down in the event of wind or fire damage to create room for repairs.

What Size of Businesses Need Business Owner’s Policy?

Any business owner should consider this coverage if:

There is a possibility of being sued: Generally, every business is exposed to the risk of lawsuits. For instance, a customer may slip and fall on a wet floor in the business premises. That customer can potentially sue to get compensated for the injury. As an entrepreneur, if you don’t have business owners’ insurance, you might be forced to dig deep in your pocket to cover the legal fees and the victim’s medical expenses.

You have a physical business premise: Any business with a physical business premise is prone to accidents such as fire, floods, or wind damage, to mention a few. Luckily, insurers can customize a policy to cover business run out of a rented store, home, garage, or an owned office.

You have assets that could get damaged or stolen: This coverage includes both tangible and intangible assets. The policy can compensate for business equipment, digital assets, inventory, and furniture in the event they get damaged or stolen.

Benefits of Business Owner’s Policy

Acquiring a business owner’s policy is a brilliant and convenient idea. It simplifies the number of coverages you need for your business by combining business liability and property insurance.

BOP offers value for money for businesses while covering them from perils such as:

  • Theft
  • Fire
  • Loss of income
  • Lawsuits

Getting a BOP policy is more affordable and convenient than buying two separate policies. Besides, you can discuss with your insurer to add an endorsement that will extend your business coverage. This allows businesses to get tailormade covers for their unique business needs.

With Business Owner’s Policy, Do You Still Need Another Policy?

If your business has employees, it is imperative to acquire a workers’ compensation policy. This policy is acquired separately from the BOP.

Workers’ compensation policy covers staff income if they cannot work due to covered injury or illnesses. The policy comes in handy in the event an employee suffers from an injury or illness. Also, the insurer may compensate the worker’s family in the event a worker dies while in line of work.