Business Owner's Policy Definition

What Is a Business Owner's Policy (BOP)?

Business Owners Policy (noun): a small business insurance package that offers General Liability Insurance and Commercial Property Insurance for a discounted rate.

If your insurance provider finds that your business is "low-risk" for these types of claims and meets other qualifying criteria, then you may qualify to purchase a BOP in lieu of separate policies. BOPs often offer discounts to small businesses.

How Does the BOP Help Small-Business Owners Save Money?

A Business Owner's Policy is an insurance package that rewards you for being a small-business owner. BOPs actually cost less than buying General Liability and Property Insurance separately. That's because insurers only sell BOPs to small- and medium-sized businesses that don't work in risk-prone industries.

By only selling to less risky businesses, insurers are able to lower their insurance premiums and offer you a discount. It's a good deal for you and a good deal for the insurance company.

When Does a Business Need a BOP?

Remember that a Business Owner's Policy is actually just an insurance bundle. The first policy in this bundle is General Liability Insurance, which is often required in business agreements.

When you sign a lease with a landlord or a contract with a big client, they want reassurance that you can pay your bills and meet your obligations. They want to know that if you're sued, you won't have to file bankruptcy. General Liability Insurance gives them this assurance.

General Liability Insurance covers lawsuits when your business is liable for:

  • Damaging a client's property.
  • Injuring someone's reputation.
  • Causing someone's physical injury.
  • Infringing on someone's copyright.
  • Causing a fire at your rental property.

If a client slips in your parking lot and breaks a bone, they could claim your business is responsible because you didn't deice and salt properly. The resulting lawsuit could cost tens of thousands of dollars (if not much more).

Business Owner's Policies allow you to afford this kind of cost. Check your lease agreements and other contracts for any BOP requirements before you sign up for coverage.

How Does a Business Owner's Policy Protect Commercial Property?

The second policy included in a BOP bundle is Commercial Property Insurance. This policy protects the investments you make in equipment, furniture, supplies, inventory, buildings, and other business property.

BOP Property Insurance reimburses businesses when their property is lost or damaged by…

  • Theft.
  • Fire.
  • Vandalism.
  • Some weather events (not all are covered in a policy).

Say a photographer's studio is robbed. In one night, the photographer could lose $100,000 worth of cameras, lighting equipment, computers, and other commercial property. If the photographer has a BOP, the insurance company sends a check to cover the cost of replacing the stolen items. A business without BOP coverage must replace its items out of pocket.

How Do I Find Free Quotes on a Business Owner's Policy?

One way to get the most out of your small business insurance is to review multiple insurance quotes before you buy a policy. At Insureon, our agents query some of the top-rated insurance companies on your behalf and supply you with a number of free small business insurance quotes.

You'll be able to review these quotes and find one that offers you the coverage you need to meet contractual requirements and protect your business.

For free, no-obligations BOP quotes, fill out our online insurance application. Expect an Insureon agent to send you an email with a variety of quotes, usually within a matter of minutes.


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