What Is a Business Owners Policy (BOP)?

Securing your company’s future is an integral part of being a business owner. Given your vested interest in your business’s successes or failings, you must maintain robust risk management and loss control practices, including acquiring suitable insurance. That’s why it’s crucial for business owners to understand and strongly consider a business owners policy (BOP).
Business partners shaking hands

The agents at RCU Insurance Services have over two decades of experience helping businesses in the Santa Rosa area assess and address their coverage needs.

What Does a BOP Cover?

As the name may suggest, BOPs represent a valuable insurance solution for business owners. Generally, these policies are intended for small- and medium-sized businesses across all industries. BOPs provide critical coverages that can protect your business from losses and damages arising from many common incidents. Furthermore, by bundling several types of insurance into one policy, these arrangements may also be convenient and cost-effective.

Although the specific details of a suitable BOP may vary, in most cases, an adequate policy will include the following types of insurance:

General liability—If an incident occurs on your premises and causes harm to a third party, you may be held responsible for the resulting losses and damages. Fortunately, this coverage can help pay for the following expenses:

Medical treatment
Lost wages
Reparations for damaged property
Legal fees

Commercial property—If a covered event results in property used to operate your business being damaged, lost or stolen, your BOP can help pay for repairs or replacement costs. This type of coverage will generally provide financial protection for the following:

Buildings
Equipment
Tools
Inventory
Signage
Landscaping
Furniture

Business income—This coverage may provide financial assistance for various expenses and losses related to a temporary interruption of your company’s regular operations, such as the following:

Rent/mortgage payments
Lost income
Employee wages
Tax payments
Loan payments
Temporary relocation

While most BOPs will include the aforementioned core types of insurance, it may also be worth it for your business to augment your insurance portfolio with additional protection. After analyzing your risks and exposures with one of our qualified agents, the following coverages may be advisable additions:

Workers’ compensation insurance—If an employee is injured at work or develops a work-related illness, this coverage can render financial assistance for health care costs, reduced income, disability benefits and legal expenses.

Commercial auto insurance—This coverage can provide financial assistance for losses and damages related to your company’s motor vehicles.

Professional liability insurance—If a client or partner alleges that your business is liable for their losses due to a professional error, this coverage, also known as errors and omissions insurance, can insulate you from damages.

Cyber liability insurance—This coverage may help pay for various expenses arising from a cyber incident or data breach, such as notifying affected parties and restoring compromised systems.

Employment practices liability insurance—If a current or former employee sues your business for improper workplace practices, such as discrimination, wrongful termination or sexual harassment, this coverage can provide financial aid.

Get the Right Coverage

Owning your own company can be rewarding and lucrative, but business owners must be constantly aware of certain inherent risks and exposures. Beyond the potential damages that could derail your business’s mission and growth, substantial losses for your company could also have significant consequences for your personal financial situation. Fortunately, a suitable insurance portfolio can provide critical protection.

We’re here to help. Contact RCU Insurance Services today to speak with one of our BOP experts. We will work diligently to assess your business’s insurance needs and work with you to tailor ideal coverage.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.