Share Agent Blog
07 Aug 2025
Running a business—especially a small one—is no small feat. You're juggling day-to-day operations, managing employees (or wearing all the hats yourself), and trying to stay ahead of competition. One thing you shouldn’t have to stress about? Having the right insurance coverage to protect all that hard work.
That’s where a Business Owners Policy, or BOP insurance, comes in. Think of it as a pre-packaged solution that combines some of the most essential forms of small business insurance into a single, cost-effective policy. In this guide, we’ll break down what a BOP is, what it covers (and doesn’t), and whether it’s the right choice for your business.
What is a Business Owners Policy (BOP)?
A Business Owners Policy (BOP) is a bundled business insurance package designed specifically for small to mid-sized businesses. It combines general liability insurance and commercial property insurance, and often includes business interruption insurance as well.
Instead of purchasing these policies separately, a BOP lets you group them together—usually at a lower cost than buying each one individually. It’s designed to offer broad protection against the most common risks small business owners face, such as property damage, customer injury claims, and temporary shutdowns due to covered events.
Who Needs a Business Owners Policy?
A BOP is ideal for:
Small businesses with physical locations (offices, shops, restaurants)
Home-based businesses with expensive equipment or customer foot traffic
Businesses that want simple, bundled coverage at a lower price
Retailers, contractors, consultants, bakeries, and other service-based providers
If your business owns property, interacts with the public, or could suffer income loss due to unforeseen events, a BOP might be exactly what you need.
What Does a BOP Insurance Cover?
BOP insurance brings together several key protections in one policy. Here's a breakdown of what you’re getting:
Property Insurance
This portion of the BOP covers your physical assets, including:
Your building (if you own it)
Business equipment (computers, tools, kitchen appliances, etc.)
Inventory and supplies
Furniture and fixtures
Signage and exterior structures
If your property is damaged due to covered perils like fire, theft, or vandalism, your BOP helps you recover financially—whether it’s for repairs, replacements, or relocation.
General Liability Insurance
This component is crucial for protecting against third-party claims of:
Bodily injury (e.g., a customer slips and falls on your premises)
Property damage (e.g., a contractor damages a client’s floor)
Legal defense costs (even if you’re not at fault)
Having business liability insurance bundled into your BOP provides peace of mind—one major lawsuit could otherwise cripple a small business.
Business Interruption Insurance
Also known as business income insurance, this coverage helps when you’re forced to close temporarily due to a covered loss. It typically covers:
Lost income during the downtime
Ongoing expenses (payroll, rent, utilities)
Temporary relocation costs
This is especially valuable for brick-and-mortar businesses that depend heavily on daily foot traffic and in-person operations.
What’s Not Covered by a BOP?
While a Business Owners Policy offers strong foundational protection, it's not a one-size-fits-all solution. Here are some common coverages not included in a standard BOP:
Workers' Compensation
If you have employees, most states require workers' comp insurance. This coverage pays for medical expenses and lost wages if an employee is injured on the job. It must be purchased separately.
Professional Liability
Also known as errors and omissions insurance, this protects against claims of negligence, missed deadlines, or substandard work. It’s a must-have for consultants, accountants, tech professionals, and anyone offering specialized advice or services.
Commercial Auto
If your business owns or operates vehicles, you’ll need commercial auto insurance. A BOP doesn’t cover accidents or damages related to work vehicles.
Cyber Liability
With cyberattacks on the rise, cyber insurance is crucial if your business stores sensitive data, accepts online payments, or operates in the digital space. BOPs typically exclude this coverage unless added as an endorsement.
Pros and Cons of a BOP Insurance Policy
Let’s weigh the upsides and potential limitations of a Business Owners Policy:
✅ Pros
Bundled Convenience – One policy, one premium, one renewal date.
Cost-Effective – Cheaper than buying each policy individually.
Core Protection – Covers the essential risks most small businesses face.
Simplifies Decision-Making – Easier for business owners to manage insurance.
❌ Cons
Limited Customization – You may not be able to tailor it precisely to your industry’s needs.
Coverage Gaps – Doesn’t automatically include things like cyber, auto, or workers' comp.
Not for Every Business – Large companies or high-risk industries may need broader commercial coverage.
How Much Does a Business Owners Policy Cost?
BOP pricing varies based on a number of factors, but here are some national averages to give you a ballpark:
According to the U.S. Small Business Administration, insurance costs can range widely depending on your industry, risk profile, and the specific coverage selected. Bundled options like a BOP can offer savings of up to 20% compared to purchasing separate policies.
Factors That Affect BOP Pricing
Business Location – Businesses in high-risk areas (for crime, weather, etc.) often pay more.
Industry Type – Riskier professions (like food service or construction) have higher premiums.
Business Size – More employees or larger buildings usually mean higher costs.
Claims History – A clean history can help lower your rate.
Should You Bundle BOP With Other Business Insurance?
Absolutely—especially if your business has specialized risks that a standard BOP doesn’t address.
When to Add More Coverage:
You have employees → Add workers' comp.
You drive for work → Get commercial auto.
You offer professional advice → Consider errors & omissions.
You store customer data → Add cyber liability.
Customizing Your BOP
Many insurers allow you to add endorsements or riders to your BOP for enhanced protection. Examples include:
Equipment breakdown
Inland marine (covers tools in transit)
Employee dishonesty coverage
Outdoor signs and landscaping
Working with a local agent can help you build the ideal package tailored to your exact needs.
How to Find Local Business Insurance Agents
Why Go Local?
Personalized Service – Local agents take time to understand your unique business risks.
Regional Expertise – They’re familiar with local laws, weather patterns, and market conditions.
Long-Term Relationships – A trustworthy agent is an asset as your business grows.
Find the Right Agent on IA Near Me
At IA Near Me, we’ve reimagined how business owners connect with insurance agents. Our platform matches you with verified local agents who specialize in small business insurance—including BOP insurance.
All it takes is a quick form, and we’ll link you with nearby professionals who can walk you through the coverage you need, offer competitive quotes, and help you compare plans side-by-side.
A Business Owners Policy isn’t just a smart financial move—it’s a strategic one. For small businesses, it offers peace of mind through bundled coverage that tackles your most common risks without overwhelming your budget.
Whether you're launching a startup, running a family-owned shop, or growing your freelance gig into a full-blown business, a BOP can be the safety net that lets you focus on what matters most: your success.
Get BOP insurance quotes with local agents on IA Near Me today!
FAQs
I run a small bakery from home—do I still need a Business Owners Policy?
Yes, even home-based businesses can benefit from a BOP. If customers visit your home or you store expensive equipment or inventory there, a BOP helps protect your assets and shields you from liability risks. However, check with your agent—some insurers require a separate endorsement for home-based operations.
Can I include cyber liability or commercial auto in my BOP, or do I need a separate policy?
Most BOPs don’t include cyber liability or commercial auto by default. That said, some insurers allow you to add cyber coverage as an endorsement. Commercial auto, however, almost always requires a separate policy. An agent can help you identify and close any coverage gaps.
I’m opening a small retail store. Would a BOP be enough to protect me from lawsuits and property damage?
A BOP is a great starting point. It typically includes general liability (to handle lawsuits from customer injuries) and property coverage (to protect your store, inventory, and fixtures). But depending on your risk exposure, you might also want to add equipment breakdown, spoiled goods coverage, or employee dishonesty insurance.