Tag: business owners policy

What Kind of Insurance Does Your Small Business Really Need? 

It takes guts to open your own business. Seriously — taking that kind of risk, putting your time, money, and energy on the line to build something of your own? That’s bold, admirable, and worth protecting! 

You’ve taken a big chance and gambled on yourself — now don’t risk everything you’ve built by skipping out on the right insurance. Figuring out the right insurance coverage probably sounds boring, tedious and overwhelming, but we have good news!  Business insurance doesn’t have to be complicated. There are a few key policies most small businesses need, and once those are in place, you’re off to a great start. 

Here’s the basic policies most small businesses need: 

1. General Liability Insurance  

Accidents happen — and when they do, this is the coverage you’ll be glad to have. General liability protects you if someone gets injured at your business or if you accidentally damage someone else’s property. It even covers legal fees if a claim turns into a lawsuit. 

Example: A customer slips and falls at your business. You’re covered. 

2. Commercial Property Insurance  

Whether you own a storefront, lease an office, or run your business from a workshop or warehouse, property insurance covers your physical assets — like your building, tools, inventory, and equipment — from fire, theft, storms, and more. 

Pro Tip: If your business operates from home, your homeowners insurance typically doesn’t cover business-related losses. Property coverage tailored for your business is essential. 

3. Commercial Auto Insurance  

If you use a vehicle for business — even if it’s just one — you’ll want this. Commercial auto covers business vehicles and drivers, so you’re not left paying out of pocket. 

Pro Tip: Personal auto insurance typically won’t cover accidents that happen while you’re working. 

4. Umbrella Insurance  

Think of this as a safety net. Umbrella insurance kicks in when a big claim exceeds the limits of your other policies — like general liability or auto. It’s the peace-of-mind policy that helps protect your business from large, unexpected losses. 

There’s more available than just the basics 

Depending on your industry and operations, you might need other coverage — like workers’ comp, cyber liability, professional liability, etc. Every business is different, which is why it’s smart to work with an insurance advisor who can help assess your risks and recommend the right protection. 

Bottom line: 
Taking risks is part of being a business owner — but leaving your business unprotected isn’t a risk you can afford. 

Let’s make sure you’ve got the right coverage in place. 
We’re here to help you protect what you’ve built — reach out today for a quote! 

Author: Judy Sivy

BOP it!

How Can My Business Qualify for a Business Owners Policy?

Many small businesses search for a way to save money on insurance, as they believe that they require less than smaller businesses. While this may be true as a general rule, it is still important for small businesses to find the coverage they need at a price they can afford. 

A business owners policy is business insurance specifically created to cover small businesses in low risk industries with reliable commercial insurance. Not all businesses can qualify for business insurance, however. 

Size and Industry Qualifications 
Only businesses of a certain size and within a certain industry will qualify for business insurance. The size category of your business can vary depending on your industry, however. For example, one industry may consider a business with 100 employees may be considered a small business while another industry may consider a business with 1,000 as a small business. 

Size can also be determined based on your business’ annual income. If a business that is small employee-wise but has a substantial annual income, they may or may no qualify for a business owners policy.  

When it comes to industry, only businesses in low risk industries may qualify for a business owners policy. A low risk industry is one that does not present as high a risk of an accident or lawsuit as other industries. Examples of low risk industries include: 

​What Do You Need to Get a Business Owners Policy? 
Once you are certain that your business qualifies for a business owners policy, you can start purchasing insurance. You must be able to provide the appropriate information to your potential insurer in order to purchase this insurance, including: 

​Every BOP is different depending on your business and its insurance needs, so speak with an insurance agent about what you need to insure your business. 

Getting Insured Once You Qualify 
Say you are qualified for a business owners policy and have the relevant information ready. What now? 
First, compare quotes from multiple insurers. Comparing insurance providers and their prices can help you find the policy you want at a reasonable price. It can also help you figure out how much and what type of insurance your business needs. 

Knowing what a BOP covers is crucial for choosing the right policy. For example, a basic BOP includes two basic coverages: 

​Additional coverages are available, as well, depending on your business’ insurance coverage needs. Optional coverages you may consider adding to a BOP include: 

If you have any questions about how to qualify for a business owners policy or what coverage you should have, speak with an insurance agent. 

Does a Business Owners Policy Include Business Interruption?

Business owners policies are useful for saving money by combining coverages for small businesses in low-risk industries. However, many business owners make the mistake of believing that their business owners policy covers everything automatically. There are some optional coverages that may not be included on your policy unless you ask your insurer to add it to your policy. 

Business interruption insurance is one of these. 

What Does Business Interruption Insurance Cover? 
Business interruption insurance steps in if the business is unable to continue operating due to a disaster, government mandate and more. Due to recent events, this insurance has become crucial for businesses. It can replace or compensate for: 

Business interruption insurance helps the business with the cost of moving to a temporary location if necessary. It also covers the cost of employee wages that the employer may not be able to afford due to a drastic drop in revenue. 

This insurance is useful for protecting your business in case it is put on hold. Business interruption insurance is especially useful for some businesses that are or were put on hold due to COVID-19. 

What Does Business Interruption Insurance Not Cover? 
This insurance unfortunately cannot cover everything. It does not cover utility bills, interruptions due to utility failure, undocumented income, market conditions or economic activity that may hurt the business, or anything excluded from your commercial property policy. Business interruption insurance is not the same as property insurance. It won’t pay to replace your business’ equipment or physical building after a disaster. 

How Much is Business Interruption Insurance? 
The average cost of a BOP with business interruption insurance can be anywhere between $500 and $3,000 a year. This cost depends on the size of your business, coverage limits, deductible, location and the industry of the business. Compare this with the thousands or millions your business could lose by being out of business for a month or more.  

The worst thing for a business, especially in its starting years, is to be unable to operate because of forces outside of its control. Having a comprehensive insurance policy can be the difference between struggling to maintain employees and operations and surviving to come out of the disaster prepared to start again. 

What Should a Business Owners Policy Cover? 
At its most basic, a business owners policy covers: 

BOPs are somewhat flexible when it comes to adding coverages. Common coverages added to a BOP include: 

​Each of these insurance policies are designed to protect the business financially from different risks. Business interruption insurance is often included with commercial property policies, although it can be purchased separately and added to a package such as a BOP or commercial package policy (CPP). 

The Benefits of Bundling 

Bundling your business’ insurance coverages can help you save money by combining coverage as well as offering ease when it comes to having all of your business’ insurance in one place. It can also help you prevent your policy being cancelled or dropped, as insurers are less likely to cancel a policy of an insurer who has more than one policy. 

Speak with your insurance provider about the right insurance coverage you should add to your business insurance policy. 

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