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What Is A BOP Policy?

February 7, 2012

A Business Owner’s Policy, frequently called a “BOP” policy, combines property and liability insurance into a single policy form — an affordable way for a small to mid-sized business to obtain these essential coverages.  The policy features common declarations, common policy conditions, and broad coverage definitions. Coverage sections usually include:

Business Personal Property – Coverage for the cost to replace physical assets, such as contents, that are owned or leased.

Commercial General Liability – Coverage for negligent acts and/or omissions that result in bodily injury or property damage.

Products and Completed Operations – Coverage for claims after a manufactured product has been sold and/or a claim that results from an operation which the insured has completed.

Personal Advertising Injury – Coverage for a statement made in the course of advertising activities that causes loss by libel, slander, defamation, misappropriation of ideas, or infringement of copyright.

Hired Non-Owned Auto – Coverage for damages to a third party, caused by autos leased, hired, rented, or borrowed for use in the insured’s business.

Business Interruption – Coverage for the loss of profits and continuing fixed expenses due to a break in business activities due to a covered cause of loss.

The core elements of a BOP policy are fairly standard throughout the industry however carriers do differentiate themselves by offering various coverage extensions such as: Employee Theft, Computers & Media; Data and Software; Monies & Securities; and Valuable Papers.

One last note. A standard BOP policy does not cover professional liability (liability claims arising from wrongful practice by professionals), auto insurance or worker’s compensation. These all need to be purchased separately.

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