BOP (Business Owners Policy) Explained

​Business Owners Policy, also known as BOP insurance, is common among small to medium-sized businesses. It is a combination of both property and liability coverage, making it a more convenient policy for small businesses. Some of these are restaurants, merchandisers, and contractors. 

BOP Eligibility
Although this policy is designed for small businesses, they must first meet specific coverage requirements under a BOP. There are no standards for requirements because they vary from one insurer to another. Examples of businesses that are eligible for BOP are salons, hotels, merchandisers, and wholesalers. On the other hand, fast food restaurants, cafes, and other small food establishments are only eligible if they do little cooking. Residential contractors, carpentry, and landscape work are also suitable for a BOP.

In insuring apartments, residential condominiums, and other buildings used for business operations, the BOP may be used. However, there is a limitation in size. In the case of buildings, only six stories are allowed or only up to 100,000 square feet. BOP Eligibility depends on the size and nature of the business’s operations. 

BOP Coverage
One of the standard coverages of a BOP is commercial property. It covers buildings, machinery, and equipment at the premises of the business. Personal property and improvements and betterments of tenants are also covered. However, exclusions in a BOP are the same as “All-risk” property policy. 

Another standard coverage under BOP is general liability coverage. It consists of bodily injury, property damage liability, and personal injury liability. The BOP includes medical payment coverage, which pays for medical costs by injured individuals because of business operations. 

Additional
Under a BOP, insureds can include several additional coverages under a standard property policy. Most of the contents are at a low limit. However, business income and extra expenses are exceptions because they do not have specific limitations in applying for these coverages. Here are some of the coverages that can be added to the BOP.

1. Business Income
2. Extra Expense
3. Civil Authority
4. Valuable Papers
5. Account Receivable
6. Electronic Data
7. Interruption of Computer Operations

Commercial Umbrella
In some cases, businesses may need higher liability limits than a BOP. A commercial umbrella can be written in combination with BOP.

At Arnold, Bruce & Doerfler Insurance, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get the insurance that fits your needs. You can get more information about our products and services by calling our agency at (503) 222-1951. Get your free quote today by CLICKING HERE.