Do You Need BOP Insurance in your Tool Kit?
What are the essentials needed to operate a successful business? Qualities like entrepreneurship, creativity, leadership, organization and a strong work ethic probably come to mind. And these are all important traits.
But business owners may want to look beyond these traits to something that is often overlooked: Proper insurance coverage. This is one of the most important instruments in a business owner’s tool kit. Why? Because without appropriate insurance coverage, a business may not be able to weather a disaster. And it could mean the loss of everything he or she has worked so hard to achieve. For many, a Business Owner Policy (BOP) will provide that much-needed sense of security at a reasonable cost.
What is a BOP?
BOP stands for business owner policy. A BOP is an insurance package available for business owners that combines basic coverages into one bundle.
What does a BOP cover?
BOP policies typically cover three major areas of business protection. A standard BOP includes property insurance for the company’s buildings and contents; liability protection for harm caused by employees, defective products, faulty installations, and service errors; and business interruption insurance, which covers loss of income due to a disaster.
What does a BOP not cover?
While a BOP covers many of the basics, it’s not comprehensive. Business owners still may need more-specific policies, depending on the type of company and products or services provided. A BOP also doesn’t cover workers’ compensation, health and disability insurance, professional liability, or auto insurance.
Who is eligible for a BOP?
BOPs are designed for small to medium-sized businesses. Typically, a company must meet the requirements set forth by the insurance carrier to qualify for a BOP. These parameters usually include the number of employees, type of business, and yearly revenue. Larger businesses qualify for different types of policies that are more appropriate for their needs.
Who needs a BOP?
Some industries may also need special insurance in order to operate. For example, a minimum amount of liability insurance may be required to perform contractor services.
While you don’t have to choose this bundle option, it is an easy solution for many small and medium-sized businesses.
What are the advantages of a BOP?
Choosing a BOP typically saves money. By bundling several services in one policy, business owners pay less than the total cost of individual coverages. This option keeps costs down while providing coverage for the business’s basic needs.
How much does a BOP cost?
The yearly premium for a BOP depends on many variables. One business may need higher liability coverage, while another may need greater property protection. The pricing for each BOP is determined by these needs and the risk factor of the company. Typical premiums range from $500 to $3,500 per year.
How do I get a BOP?
Contact your insurance agent to discuss the BOP options available for your business. He or she will discuss how you can bundle the specific coverage you need into an appropriate and affordable BOP that’s just right for your company.