What is a Business Owner's Policy?

Liability Insurance

A business owner’s policy, or BOP, combines general liability insurance with commercial property insurance, typically at a lower rate than if the policies were purchased separately.

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When do small businesses need a BOP?

All small businesses that want protection from unexpected financial losses should consider a business owner’s policy. Many companies only purchase general liability insurance, which does not protect business property. A BOP bundles general liability insurance with commercial property insurance for more complete coverage.

A business owner’s policy bundles two insurance policies at a discount:

1.   General liability insurance

General liability insurance protects against common business risks, such as customer injury or damage to client property. It’s often required when signing a commercial lease or a client contract.

2.   Commercial property insurance

Commercial property insurance protects your building, equipment, and inventory from damage or loss.

A BOP is ideal for a small business that wants protection against common lawsuits and coverage for valuable business property, such as a building or specialized equipment.

Business owner’s policy protections

Home business Freelancers Small business
Liability_protection You want to guard against business-related bodily injury and property damage lawsuits, such as a customer tripping at your home. Clients may ask you to provide a certificate of insurance in case you damage equipment at their office. You sign a commercial lease requires general liability insurance.
Advertising injury protection You create a social media page for your business, which opens you to accusations of libel and copyright infringement. You want reassurance that someone involved with a project cannot damage your business with an accusation of libel or slander. You launch an advertising campaign and want protection against accusations of defamation or copyright infringement.
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Business owner’s policy eligibility requirements

Not all businesses are eligible for a business owner’s policy. Businesses that are eligible for a BOP typically have:

  • Industry and risk factors
  • Coverage limits
  • Location
  • Number of employees
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