When insuring your small business, you might find an ideal coverage solution in a business owners policy (BOP). These packages of essential commercial insurance benefits will combine several pieces of critical coverage in one place, and at one affordable cost. Therefore, they will allow you the convenience of being able to obtain foundational coverage in one easily manageable place.
Still, a BOP alone is not the only coverage that most businesses need, nor is it wise to put together your benefits arbitrarily. You must customize your BOP to fit your needs, and often this will mean expanding upon it with extended benefits. There are a few different steps you might have to take to establish a comprehensive commercial insurance portfolio, and we’ve outlined a few of them below.
Understanding BOPs
When you buy a BOP, you will receive many of the cornerstones of commercial insurance, including:
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Property & Structure Coverage
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Possessions/Contents Coverage
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Commercial General Liability (CGL) Coverage
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Business Interruption Coverage
You will have the ability to customize your plan to include coverage limits that will address your financial needs and any special liabilities present in your operation. Still, the BOP will remain a single policy, and you will only pay one premium for it.
Still, even if you qualify for a BOP, that doesn’t mean it is a stopping point for your insurance needs. Generally, you will have to augment your BOP with other coverage, which will better encompass the overall liabilities associated with your business.
How Can You Get Extra Coverage?
When getting extra coverage for your BOP, you might be able to add some benefits to your plan through specialty endorsements. Others, however, you must purchase separately. However, these separate policies will work alongside your BOP to keep your business as secure as possible.
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Cyber liability insurance will protect clients and the business in case of data breaches, cyber theft or other system failures.
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Errors & omissions (E&O) insurance applies to third-party liability losses arising from mistakes in your professional services or advice.
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Equipment breakdown insurance pays for repairs and lost income resulting from failures in critical equipment.
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Commercial umbrella liability insurance can cover your existing CGL liabilities in excess of the basic coverage limits.
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Flood insurance will insure commercial property and materials if your property lies in an area of flood risks.
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Employment practices liability insurance (EPLI) policies will pay in case you face accusations of mishandling of employment terms, harassment, discrimination, etc.
The benefits of having a BOP is that it can easily be expanded upon. Therefore, it will be easy for your agent to expand your benefits with the additional coverage to expand your overall risk management program in the most effective ways. Talk to your agent about your need for expanded coverage. They can tell you which, how much, and how policies can be added to your greater business insurance portfolio.