Doing the BOP: Business Insurance for the Little Guys

Business Insurance can seem like a thick, dark forest, full of unfamiliar coverages, multi-layered policy types, and a bramble of endorsements that can confuse anyone not in the industry.  It can seem especially confusing when compared to personal insurance policies, which are usually pretty straightforward and familiar to most of us.

This better be the right policy…

Luckily, there is an alternative.   Small to medium sized business owners can use a special, pre-packaged policy based on the Homeowners model, called the Business Owner’s Policy, or BOP.  The BOP is a great option for a whole range of businesses, including Mom-and-Pop shops, professional offices, and mid-size regional players.  Even freelancers can find protection with a BOP, with coffee-swilling graphic designers, stay-at-home coders, or pavement-pounding makeup sales gurus all getting the coverage that they need to keep business humming along smoothly.

Do you even BOP, bro?

The BOP is broken down into two main sections, Property and Liability.  If this sounds familiar, then yeah, it is exactly like the policy on your house.  There are a few differences, so let’s get down to it.

Property coverage on the BOP covers your business stuff, whether that be the building you own, the office equipment you use, the computers you process payments on or design rad new fonts with (that’s a thing, right?), and even the chair you’re sitting in as you read this – if it’s your work chair.  If your business owns it, the BOP covers it.  EXCEPT for cars, planes, boats, anything that you can get in and drive around in.  The BOP doesn’t really do those, leaving them to other policies for coverage.  The BOP also doesn’t cover what is IN your computers, i.e. the data.

Another major difference is the special business protection under the BOP’s property section, broken into two parts.  One of these is Business Income Coverage, which helps you make up for any income lost when your business is closed due to a covered loss.  Another is the Extra Expense Coverage, which can help with those extra expenses that can help you stay open after a covered loss.  Both of these are aimed at helping your business stay afloat after a loss to your property that would otherwise put you out of commission, whether that be a fire to your building, or someone stealing your laptop that contains your entire design company in it’s shiny body.  While the work itself won’t be covered, the income that would have kept you in business would be taken care of by your BOP.

Liability protection is based around protecting you from anything that your business can be held responsible for, whether that be someone getting hurt on your premises, a rival business suing you for slander, or infringing on someone else’s copyright.  Not that you would ever do anything like that.

Maybe I shouldn’t have used my ex as my billboard without asking her…

Having the right liability coverage can be the difference between you staying in business and you owing more than your business is worth.  The risks mentioned above can do more than just make you shut up shop, as no one can predict how much a jury will award if a motion goes to court.  Even those of us who think we aren’t exposed to risk just aren’t being honest with ourselves about what can happen in today’s ultra-competitive marketplace.  Having a BOP that covers you from this kind of exposure is vital to moving forward confidently and meeting your goals without looking over your shoulder.

For all you visual learners out there, here’s a short video about BOPs and why they are awesome.

All in all, the BOP is a great policy for lots of different people.  If you think you might be one of them, why not reach out and see if we can help?  Fill out the form below and we’ll be happy to contact you about hooking you up with a BOP.