A business owners policy (BOP) is a useful insurance package tailored for small businesses in low risk industries that splits coverage for liability and property. Commercial property is crucial for your business’ location and every day operations, which is why it is important to know what is and isn’t covered under your BOP.
What Does A BOP Cover?
You can customize your business owner's policy to meet any goals you have. Your policy should always fit the specifics of your assets. Here is a closer look at the assets it may cover.
What type of buildings do you use as a component of your business? These may include large office spaces, additions, or expansions that you are building. You may have a wide range of outbuildings or storage areas as well. It includes all the buildings you own.
If you have signs or fixtures outside, commercial property insurance under your BOP may cover them. This is especially important if your business has outdoor furniture and fixtures such as if your restaurant has a patio for clients to eat and drink on.
Third-Party Owned Items
Your BOP often covers items that a third party owns, but that you are taking care of for the time being. For example, if you are a mechanic, the policy protects the vehicles you are repairing while they are on your property. This assumes only temporary protections. It includes items under your care as well as your control or custody. In some cases, this falls under your company's liability coverage.
Do you have a significant amount of inventory on your property? If this inventory is housed within a covered building, the BOP should cover it. If you store inventory offsite, you might need to customize your policy to reflect this. Don’t assume it applies.
Equipment and Other Assets
Most assets located on your property, including your company’s equipment, have coverage. This includes such items as your machinery, refrigeration, warehousing system and furniture. Most often, all property covered under the policy must be on the property or within 100 feet of it. It’s important to meet this requirement to keep your valuables protected.
Speak with your insurance agent about finding a BOP tailored specifically to cover your business’ needs. Every business is different and your coverage should depend on your business’ unique commercial property risks.