What kind of business insurance policy do I need for my business?

As a business owner, it’s important to have just the right amount of insurance to protect yourself, your employees, and your investment while levering your resources to the right budgets. There are two types of basic business policies available for business owners depending on the size and structure of your company. These two policies are called Business Owner’s Policy (BOP) and the Commercial Package Policy (CPP).

What is a Business Owner’s Policy (BOP)

A business owner’s policy, also know known as a “BOP,” is designed for small to mid-size businesses and typically includes three main types of coverage: property insurance, business income insurance and liability insurance.

If your business only faces a small amount of risk, a BOP may be the right policy package for you. Two factors that help decide if a business is eligible for a BOP is the type of business, and physical size of the business based on square footage. If your company has a specific risks, like a jewelry store or a shipping company, you may not qualify. Whereas home-based businesses or businesses with a small amount of employees are perfect for a BOP package.

A BOP is typically used for particular spaces like apartment building, office buildings, wholesalers or contractors.  The BOP is a lower cost option for covering property and liability, compared to purchasing individual policies. However, a BOP does not include worker’s compensation, disability insurance, commercial auto insurance or professional liability, so there is a need to fill gaps with added policies.

What is a Commercial Package Policy (CPP)

Just like a BOP, a Commercial Package Policy (CPP)  allows you to combine individual coverages for your business under one policy. When you coverage needs go beyond what a BOP can provide, a CPP becomes the perfect option. It’s a flexible approach to customizing your insurance needs without paying for policies separately.

CPPs are available to different types of businesses and a basic CPP will typically include property insurance and general liability insurance, just like a BOP. From there, additional coverage forms can be added.

What business policy is right for my business?

Talk to your insurance agent to learn whether a BOP or a CPP is right for your business. Finding the right insurance package is important because without it you are putting yourself and your employees at financial risk if an accident were to happen. Be honest with your insurance agent to ensure that all potential risks are covered and always ask for any insight on potential discounts.

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