BOP Insurance

A BOP is a Business Owners Policy

A BOP is designed and tailored for specific classes of business. They are similar to commercial insurance package policies in that both types of policies combine liability insurance with additional lines of coverage. The primary difference between the two types of coverage is a BOP is already designed by the insurance company based on common needs of a business, while package policies are fully customized by the insured and their agent. BOP coverage is best suited for small business owners who do not have a need for a customized policy.

The real benefit of a BOP is that the insured gets a more well-rounded policy at a very affordable price, without having to spend a lot of time evaluating all of the available coverage options.

BOPs Combine Liability Insurance with Other Lines of Coverage

The foundation of a BOP is either a general liability, professional liability or a combination of both products, depending on the type of business. The BOP includes other lines of coverage commonly needed by similar types of business. BOP coverage will almost always include additional coverage for property insurance as well as automatically include coverage for lines such as business interruption, EPLI coverage, data breach, tools and equipment (inland marine coverage) and hired and non-owned auto.

BOPs are specifically designed for target business owners and, therefore, a BOP would be different for an IT company than it would be for a florist, or a beauty salon. BOPs are not available for every type of business and the included coverage will vary by insurance company.

A General Liability Shop BOP insurance policy combines several lines of coverage under a single policy.

A BOP Combines Several Lines of Coverage Under a Single Policy:

✓ General Liability Insurance for Third-Party Liability
✓ Property Insurance for Buildings and Personal
✓ Business Interruption and Extra Expense Coverage
✓ Additional Coverages for EPLI, Data Breach and More

BOPs include pre-established lines of coverage and only allow for minimal changes in the limits of insurance. For example, a small lawn and landscaping company may qualify for a BOP program with several insurance companies. The policy may automatically include coverage for tools and equipment at $5,000 and business interruption coverage at $15,000. The lawn care company will not be able to exclude these additional lines of coverage, but they will be able to increase coverage limits up to a certain limit of coverage. If the landscaping company has tools and equipment valued at $25,000, the policy can usually be endorsed to increase the insurance on tools and equipment to accommodate a higher limit of insurance.

When is a BOP a Better Option?

BOP coverage is almost always a better deal for small business owners, unless they have a unique set of circumstances that require higher limits or more specific lines of coverage. Over 90 percent of the time when our agency compares a BOP to individual lines or package policies, the BOP is a better price than the alternatives. BOPs are not well suited for larger companies or businesses with high exposure to liability claims. The maximum limits of coverage with BOPs are generally not high enough to meet the needs of these types up companies. Commercial insurance packages are often a better insurance solution.

The competition among insurance carriers to create better and more affordable BOP programs continue to make BOPs better and more affordable for select businesses. Over the past decade, BOP programs have expanded to include BOP products for more and more industries. Liability insurance companies have also added more freebie coverages and they’ve increased the availability of higher limits and coverage options. The prevalence of BOP coverage is likely to continue to increase.
A BOP policy provides more coverage than a standard general liability policy.

Qualifying for BOP Coverage

Since BOPs are highly targeted to select industries, not all businesses will qualify for this type of insurance coverage. Also, not all insurance companies offer BOP programs for the same target industries. However, it’s always a good idea to ask your agent if your business qualifies for a BOP program, and to determine if the coverage meets your business needs.

Today, more and more insurance companies are offering BOP programs. A few short years ago, BOPs were not available for any type of small contractors. Today, we’re offering BOPs for dozens of different artisan contractors and construction businesses. Our agency constantly works with our top insurance companies to design and offer BOP solutions because they are more affordable and more robust than traditional methods of purchasing business insurance.

Get BOP Quotes

Find out if your business qualifies for one of our BOP programs and see how much money you can save. Get started now with our online quote form or contact one of our business insurance Specialists today.

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When to Avoid a BOP

Even though BOP coverage is often 15 to 25 percent less than traditional package policies, they’re not a fit for every business. Aside from those businesses that don’t qualify for a BOP program due to their industry, some businesses need higher limits and more sophisticated coverage than a BOP can provide.

Common Indicators a Business is Too Big for a BOP:
  • Business is highly specialized or has high risk operations.
  • Business needs insurance limits above $1 million.
  • Business owns high dollar assets or has a large inventory.
  • Business wants coverage options beyond the scope of a BOP.
  • Business has payroll in excess of $1 million or employs over 100 employees.