What is a Business Owner's Package Policy?:

A Business Owner's Package policy, or BOP, is a way that business owners can save money on their insurance needs. Since business owners typically need to purchase several different types of insurance, it can be confusing and expensive to deal with several different policies and in some cases, several different companies.

By combining all of your insurance needs into one package, you can greatly reduce the amount of money that you are spending on your insurance, simplify your payments and deal with just one company.

Let's take a look at what types of insurance are typically covered in a Business Owner's Package policy.

Property Coverage

Having property insurance is essential for business owners. This type of policy will provide coverage that will protect your property, your inventory and your equipment from damage and loss. Without property insurance, you can easily lose everything, if something should happen. Whether a fire breaks out or a storm hits, you cannot afford to lose all of your inventory, or your precious data.

When purchasing property coverage in a BOP policy, you can typically add on other types of necessary benefits, such as Business Interruption coverage or coverage from dishonest employees. For example, if an employee defrauds your company, this type of benefit would allow you to recoup at least some of your losses. A BOP may require you to pay extra for add-ons, particularly if you have expensive equipment. This would need to be added on to your basic property coverage with the addition of a benefit rider.

Liability Coverage

Liability insurance is also a type of policy that business owners cannot overlook. If someone where to incur an injury on your business property, or a product fail, a claim against your company could quickly spell ruin. BOP's will typically offer liability coverage, under a General Liability package. However, this general coverage may not be enough for your business, depending on your industry and your business' inherent risks. There is typically a threshold of $1 to $2 million of coverage under a general liability package.

However, Professional Liability coverage is usually not offered in a BOP. If you require this type of insurance for your business, you would then need to add on another policy. This type of insurance is not normally required by the average business owner, which will allow you to keep your costs low if you do not specifically require it.

There are some restrictions for purchasing a BOP, such as a maximum requirement of 100 employees and less than $1 to $1 million in gross revenue. The majority of small businesses do fall within these requirements, making a BOP a great way to save on your insurance and combine all of your insurance needs into one convenient policy.

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