Many business owners favor a Business Owners Policy (BOP) because it maximizes coverage at a lower cost than other options. A BOP combines two core business insurance plans: commercial property and general liability. It has multiple advantages, especially for small businesses such as:
- Cheaper than buying separate liability and property plans
- Covers the cost of legal fees and court costs arising from litigation
- Covers injuries that occur on your commercial property
- Provides a wide range of financial protection from disasters
- Replaces loss of stolen items from your property
- Ideal for small to medium businesses as it is cost-efficient
What Does BOP Cover?
Here’s a deeper look at the three main types of coverage you get with a BOP plan:
- General Liability – This part covers lawsuits, medical bills, and other types of problems your business may cause to your clients or customers.
- Property Damage – If your commercial property is damaged by a natural calamity or a vandal, this portion of your policy will cover the cost of restoring your property.
- Business Interruption Coverage – In the event that your business has to shut down temporarily, this coverage covers lost revenue and wages.
What Isn’t Covered by BOP?
BOP plans provide a wide range of coverage, but like all insurance policies, they don’t cover everything. These plans mainly protect against typical risks associated with the business. Mishaps that are out of the ordinary, such as earthquakes, require extra special coverage. Here are various scenarios BOP doesn’t cover:
- Employee injuries that should be covered by workers’ comp
- Certain types of flooding, such as leaky pipes due to negligence
- Litigation targeting executives who make professional errors
- Vehicles that require separate commercial auto coverage
- Cyberattacks that are covered by cyber insurance
- Equipment issues related to wear and tear
Cost of Business Owners Policy in Florida
Different businesses pay different premiums based on unique risk exposures. A home-based business typically doesn’t need as much coverage as a company with employees. Some business owners can save as much as 50 percent using a BOP plan instead of a standard business plan combined with a commercial property policy.
Other Additional Coverages
If your business needs other coverages that aren’t part of your BOP plan, consider the following types of insurance:
- Flood Insurance – Natural unexpected floods are covered in some basic plans, but if you work in a flood plain, you definitely need special coverage.
- Workers’ Compensation – This coverage is required in the state for companies with employees, as it pays medical costs and lost wages when workers are injured on the job.
- Professional Liability – Adverse business decisions and certain types of negligence are covered by this insurance in case your company faces a lawsuit over a faulty company action.
- Commercial Auto – Whether your company owns one vehicle or a fleet, each vehicle requires licensing, registration, and insurance. Commercial auto coverage is similar to personal auto coverage, but the two are separate plans that cannot be interchanged.
- Cyber Liability – Every business that operates computer equipment should consider cyber liability coverage to protect against a data breach. Such a disaster can lead to a class-action lawsuit that can shut down a business without this coverage.
- Equipment Coverage – All your business equipment can be covered with insurance extensions for items such as an HVAC system, electronic equipment, machines, and office appliances.
- Product Liability – If your company manufactures products and a defective unit causes an injury, it can lead to a lawsuit. This coverage pays for legal fees.
Most companies with employees and equipment need a Business Owners Policy in Florida or equivalent coverage. You can also customize your policy with extensions according to your business needs. Contact us at Locke Insurance Group for more information on getting a BOP plan for your small or medium-sized business.