As a small business owner, financially safeguarding your enterprise against unforeseen risks is paramount. One option to add to a risk mitigation strategy is a business owners policy, an insurance solution combining business property and liability coverage.

What Is Included in a Business Owners Policy?

A business owners policy typically offers the following:

• Property insurance may offer financial protection against covered perils for your business’s physical assets, including buildings, equipment and inventory.
• Liability insurance may help cover third-party bodily injury or property damage claims resulting from your business operations.
• Business interruption insurance can help cover extra expenses and replace lost income if a covered peril, such as a fire, disrupts operations.

You can also customize a BOP to fit your specific needs by adding optional coverages, which can vary by insurer.

What Is Excluded From a Business Owners Policy?

The following risks are typically excluded from a BOP:

• Professional liabilities—This includes errors and omissions (E&O) coverage, which may require a separate policy.
• Commercial auto risks—This typically requires commercial auto insurance.
• Workers’ compensation situations—Employee injury and illness situations are not covered under a BOP and generally require a separate workers’ compensation policy.

How Long Should a Business Keep Business Insurance Policies?

The duration for which a business should keep insurance policies can vary based on several factors, including the type of policy, the nature of the business, and legal requirements. Generally, it’s advisable to have some insurance protection at all times, but periodic reviews and coverage adjustments are often necessary. Moreover, some insurance may be required for a business, such as general liability, commercial auto or workers’ compensation, so it’s critical to understand any legal obligations and avoid policy lapses.

Business Owners Policy Requirements

Contact JM Hamilton & Associates to determine your eligibility and explore alternative insurance options if a BOP is not suitable for your needs.