Owning and operating your own business is a privilege for many Americans. It can also be a massive responsibility with a lot of risk. Just one accident, mishap, or mistake can result in damages or liability that can derail a small- or medium-sized business. For that reason, more entrepreneurs are turning to business owners policies (BOP) to protect their companies from financial loss in case of claims.
A business owners policy is a bundled business insurance package that offers a range of protection in a single, cost-effective plan. Most policies are flexible enough to allow for add-on coverages if needed. Entrepreneurs appreciate having multiple coverages streamlined into one easy-to-manage policy bundle.
Is a business owners policy a good fit for the business you own? Here’s some information to help you decide.
What Makes Up a Business Owners Policy?
Business owners policies vary across policyholders. However, most typical plans combine three elements of business insurance:
General Liability Insurance
If a party is injured on your business premises or your business is held accountable for property damage, general liability insurance covers potential losses.
Commercial Property Insurance
When equipment, inventory, furnishings, or other tangible assets your business owns are damaged by disasters or crime, commercial property insurance can cover repairs or replacement. It can also cover damage to your building, whether you own or rent it.
Business Interruption Insurance
If you must temporarily cease operations due to a covered loss, BI Insurance can replace at least a portion of your lost income during closure.
A business owners policy can also be amended to cover additional losses. Cyber liability, data breaches, company autos, errors and omissions liability, and equipment failure are just a few of the business insurance add-ons a plan can accommodate.
Who Can Take Out a Business Owners Policy?
Policies are generally available to businesses employing 100 or fewer employees and generating less than $5 million in annual revenue. They include such businesses as retail establishments, restaurants, contractors, wholesale operations, warehouses, and residential management companies.
Some businesses that incur added risk, such as bars, manufacturers, auto repair, and theme parks, generally do not qualify for coverage.
What Does a Business Owners Policy Typically Exclude?
In general, this type of business insurance excludes workers’ compensation, flood and earthquake damage, auto insurance, health, and employee benefits. However, it may be possible to obtain those coverages either as add-ons and endorsements or via another policy.
Is a Business Owners Policy Right for My Business?
How can you decide whether you need a business owners policy or if your current coverage is sufficient? It could simply be a matter of asking yourself the following questions:
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Do I own or lease commercial space?
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Does my business include frequent interaction with clients or customers?
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Could my business overcome a temporary closure or service interruption?
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Do I need to streamline my business insurance coverage?
If you answer “yes” to any of those questions, a business owners policy could be a good fit. In any event, it’s worth your consideration.
A Streamlined Insurance Solution for Locally Owned Businesses
A business owners policy can simplify insurance for small- to medium-sized companies trying to stay in step with their competition. If your business meets the qualifications, it can give you comprehensive protection as you focus on growth.
Hulett Insurance works with locally owned businesses to find insurance solutions that fit their needs. To talk to a Hulett representative, learn more about business owners policies, or get a free first quote, contact us today.
