In our last post, Business Owners Policy Insurance (BOP): What it is and Why Every Small Business Should Get One, we discussed BOP and why most businesses would benefit from this type of protection. Simply put, a BOP is a packaged insurance policy that combines different types of coverage, such as property and liability coverage, into a single policy that provides protection for all major property and liability coverage
What we didn’t talk about was the specifics based on the industries we typically cover
Topics Covered
But first, let’s define what Business Owner’s Policy insurance is, in case you don’t know.
A BOP has several advantages for customers, making them a cost-effective investment for small and medium business owners.
- One Convenient Policy – Combine your insurance policies into a single policy that better protects you and your business and reduces your administrative workload.
- Protection – Insulate your business (and yourself) from business risks such as being underinsured or gaps in insurance coverage.
- Customization – BOP insurance policies are tailor-made to fit your unique set of circumstances and risks.
- Broad Coverage – Sure, you’ll save money, but you’ll also get broad coverage for things like fire and water damage, burglary, lawsuits, and more.
- Save Money – Combined coverage like that found in BOP insurance reduces costs and premiums because you’re not paying for multiple separate policies.
Coverage varies between providers, but most businesses can enjoy additional protections based on their industry and risk factors, such as crime, inventory spoilage, forgery, and more.
If you operate a small or medium-sized business, BOPs protect you from lawsuits and liability claims, as well as protect your equipment, inventory, and may also protect you from unexpected business shutdowns.
You may benefit from BOP policy coverage if you meet the following criteria:
- You operate out of a physical business location.
- You could get sued.
- Your inventory or equipment could get stolen.
- Your inventory or equipment could get damaged.
- You have employees.
- You store private customer data.
Pro Tip: Business Owner’s Policy Insurance doesn’t typically cover professional liability, worker’s comp, health, or disability.
Now that we’ve got that out of the way, let’s dig deeper into why BOPs are a great fit for the industries listed above … with real-life scenarios that illustrate your risk if you own one of these types of businesses.
Business Owners Policy Insurance for Restaurants & Hospitality
Generally speaking, there are five major sectors of the hospitality industry, and each one carries a different set of risks that you’ll need protection for; this is why the customization offered in BOP policies is so attractive for small and medium businesses. Those sectors are:
- Food & Beverage
- Lodging
- Recreation
- Travel & Tourism
- Meetings & Events
Food & Beverage
The food and beverage sector consists of:
- Restaurants
- Cafeterias
- Catering Companies
- Cafes
- Fast Food Restaurants
- Pubs
- Delis
- Third-Party Delivery Services
Restaurants are hectic. Not only are customers coming and going, but your kitchen staff is working over and around hot equipment, deep fryers, and plenty of sharp objects.
Slips, falls, cuts, and burns can all happen on a normal day. Or, a power outage could spoil your perishables, resulting in significant losses.
A standard inclusion in many BOPs is business interruption insurance. This covers operating costs and income losses related to lost income due to damage such as kitchen fires or natural disasters.
You can better manage the unpredictable with reliable insurance coverage that insulates your business from profit losses.
Lodging Industry
If you provide overnight accommodations, you’re in the lodging industry, whether you rent out a few rooms in your vacation home or you operate a resort. This sector generally consists of:
- Hotels
- Motels
- Vacation Rentals
- Bed & Breakfasts
The safety of dozens to perhaps hundreds of guests and employees is your responsibility. Because of the large number of people who regularly enter and exit your premises, many risks are involved, including:
- Equipment Breakdowns (Heat, AC, Water, etc.)
- Fire & Water Damage
- Guest Safety
- Crime
- Accidents (Slips, Falls, Exercise Equipment, Pools, etc.)
- Alcohol Liability
- Product Liability
- Food Liability
Recreation Industry
Are you an entertainer, or do you operate one of the most common types of recreation businesses below?
- Amusement Park
- Campground
- Theater
- Museum
- Zoo
- Art Exhibit
Whether you need insurance coverage for a one-day event or year-round, Co-Op Insurance is here to help you with BOP coverage. For example, let’s consider a campground.
It may seem like a simple business to insulate from risk. After all, all you’ve got is land and a few buildings, right? Not so fast.
Insurance companies will want to appropriately assess the risk for a variety of activities, such as:
- Old Buildings
- Gas or Propane Storage and/or Sales
- Fire Rings/Grill Attachments
- Fireworks
- Inflatables/Trampolines/Climbing Walls etc.
- Pool & Pool Slides, Lakes, Ponds, Rivers etc.
- Hosted Events
And that’s just a shortlist. Depending on your particular risks, you’ll need increased coverage to protect your business from the unforeseen.
Travel & Tourism Industry
Is your business its own destination? Do customers come to your spa, adventure course, bike tour, or haunted house?
The types of services or recreation you provide, and its length of use, influences your risk factors, and therefore, your costs.
Let Co-Op Insurance customize the BOP coverage that’s right for you.
Meetings & Events Industry
Are you hosting a small, intimate wedding, a business meeting, or a big expo? Or maybe a weekend youth soccer tournament?
Then you need to consider not only the health and safety of your budding stars but also injury to others (spectators, officials, coaches, referees, etc.)
The same goes for farming or nature events involving animals, like a local fair. It’s not only people who need risk coverage but also livestock such as horses and cows, domesticated animals, and even wildlife.
This is just a short list, but some of the most common types of meetings and events that would benefit from a BOP are:
- Sporting events
- Family reunions
- Holiday celebrations
- Business events
- Trade shows
- Farm shows
- Conferences
Similar to other industries, you’ll need to account for risk factors that might arise from theft, equipment breakdowns, injury, fire, nature, financial losses, and more.
Business Owners Policy Insurance for Offices
We bet you’re as graceful as a gazelle. Unfortunately, your employees and customers probably aren’t.
Office workers are 2-2.5 times more likely to suffer a disabling injury from a fall than non-office workers, with the most common culprits of disabling office injuries being:
- Trip Hazards
- Open Drawer/Desk/File Cabinet etc.
- Cords & Wires
- Loose Carpeting
- Uneven Flooring
- Objects in Hallways
- Snow/Ice
- Unattended Spills
- Bending/Reaching from an Unstable Chair
- Using a Chair Instead of a Ladder
- Wet Floors
- Poor Lighting
In fact, as an employer, you also have to worry about Repetitive Strain Injuries (RSI) and muscle strains caused by things like poor lifting techniques or lifting heavy objects, collapsing structures, or even poor ergonomics when office workers are sitting for extended periods at their desks.
So, your comfy office may not be as hazard-free as you might initially believe.
In fact, fatalities at work are most commonly caused by:
- Struck by Vehicle/Vehicle Crash/Moving Object
- Slips/Trips/Falls from High Places
- Electrocution
- Caught in Machine/Device/Tool
You didn’t know there was so much risk at the office, did you?
Time to get a BOP!
Business Owners Policy Insurance for Condo Associations
Condo associations have similar duties to landlords even though the people they represent are owners, not renters.
The volunteers who run condo associations must maintain the grounds, common spaces, safety (fire, water, security etc.), budgets, and more.
It’s no easy task, and it’s important to know who is responsible for liability and damages should a claim be made.
The first step is to check your condo association’s master insurance policy to see what it covers. This will help you and your insurance agent uncover any coverage gaps in insurance.
It will also help the condo association and the tenants who live there understand what each party is responsible for and what condo insurance does and does not cover. For example, it is very common for owners living in a condo association to be responsible for the “walls in,” in other words, whatever is within their walls is their responsibility and thus, their liability. Say a sink in a kitchen sink overflows in an owner’s unit; the owner will most likely be responsible.
That said, some of the most common Master Insurance Policy coverage areas include:
- Shared Buildings (parking garages, gyms, pools, etc.)
- Common Areas (hallways, function rooms, stairwells, etc.)
- Landscaping
- Plumbing, HVAC, Electrical
Like any good BOP, it can be customized to meet the specific needs of your condo association with coverage such as:
- Building Coverage
- Sewers
- Drains
- General Liability
- Directors & Officers’ Liability
- Employee Dishonesty (property manager, landscaper, etc.)
- Ordinance & Law
- Inflation Coverage
- Loss of Income/Unforeseen Expenses/Unpaid Condo Fees
- Replacement Costs
- Theft of Association Funds
- Crime
Business Owners Policy Insurance for Apartment Houses
You might think that your homeowner’s insurance policy would cover damages in your small apartment house with 3 or 4 apartments, especially if you live there too. It’s just another part of your house, right?
You’d be wrong.
Standard homeowner’s insurance policies don’t cover this because you’re generating income by renting to tenants, which means you’re running a business.
The bigger your apartment house is, the more risk you need to cover.
At the least, you’ll want to consider:
- Business Interruption
- Property Damage & Peril
- General Liability
This is where a Business Owners Policy can make a big difference in keeping your costs down while providing the coverage you need. Furthermore, you may also benefit from:
- General Liability Insurance
- Commercial Property Insurance
- Business Income Insurance
- Umbrella Insurance
- Ordinance & Law
- Bodily Injury and Property Damage, Premises Liability
Not sure where to start? Contact an agent today!
Business Owners Policy Insurance for Rental Properties
If you rent office space, you must have business insurance. Your landlord is legally required to have insurance on the building itself. What is inside the rented space is the responsibility of the renter, not the landlord. Most landlords will not rent to businesses that don’t have business insurance. There’s too much risk involved.
BOP insurance typically covers commercial property, general liability, and business interruption insurance.
This will help protect you from:
- Property Damage to Your Rented Space
- Theft
- Damage by a Third Party
- Unexpected Events (damage from fire, water, natural disasters, etc.)
- Accidents or Injuries that Lead to a Lawsuit
Standard business insurance coverage doesn’t typically cover all of these examples, so it makes sense for you to protect yourself and your business with a customized BOP.
Business Owners Policy Insurance for Retail Stores
What if a nor’easter shut down your business for several days in the middle of the holiday shopping season? Imagine if the power went out and you couldn’t process credit card payments? Or the weight of snow on the roof causes a collapse? Are you prepared for the unexpected?
A BOP can protect your retail business from:
- Damage (inventory, equipment, business property, etc.)
- Lawsuits (customer injuries, property damage, faulty products)
- Lawsuits from Advertising Injuries
- Temporary Shutdowns
Pro Tip: Low-risk businesses such as small thrift/consignment stores, small online retailers, and boutique clothing stores can usually qualify for a business owner’s policy.
Business Owners Policy Insurance for Small Contractors
If you own or operate a small contracting business like one of those listed below, you should consider a BOP to ensure you’re protected.
- Electrician
- Carpenter
- Plumbing Contractor
- Landscaper
- Construction Contractor
- Painter
- Railroad Contractor
- Pool and Spa Contractor
- HVAC Contractor
- Alarm Contractor
Why?
Because a BOP combines insurance policies to mitigate your risks at a lower cost than purchasing standalone policies that may lead to insurance coverage gaps.
Conclusion
Business Owners Policy insurance is an excellent fit for most small and medium-sized businesses operating in low-risk industries. It offers the flexibility and convenience of:
- One Policy
- Broad Coverage
- Protection
- Customization
- Cost Savings
By combining different types of coverage, your business can better insulate itself from the unexpected so you can focus on what’s most important: your customers and your business.
So, now that you’ve learned about why each of these industries can benefit from BOP insurance, are you ready to speak with one of our experts so we can tailor a policy for your specific needs? Do you have questions about insurance coverage?
Find an agent today. We’ll be happy to help you out.
Sources
Centers for Disease Control and Prevention (CDC). Ergonomics and Musculoskeletal Disorders.
Investopedia. Business Owner Policy – BOP.
Nerd Wallet. Business Renters Insurance: The Ultimate Guide.
Running Restaurants. Why Your Restaurant Should Have BOP Insurance.
Society for Human Resource Management. 5 Common Office Hazards to Prevent.
Steadily. A Complete Guide to Apartment Building Insurance.
Webstaurantstore.com. What Is the Hospitality Industry?
*Disclaimer: We offer content for informational purposes; Co-operative Insurance Companies may not provide all the products listed here. Please contact your local agent to find out more about how we can help with your insurance needs.