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by Indiana Farm Bureau Insurance

Business Owners Policy Insurance Guide | BOP Insurance

A woman putting a shipping label on a cardboard box for her business

What does BOP stand for and what does it mean?  


Why is it called a BOP?  BOP, which stands for business owners policy, is just that—insurance for your business. It can be customized to your coverage needs to help protect you in case of a loss involving your business. Our job is to not only to help protect you, but to help you make sure you have the proper amount of coverage in place if a loss occurs.  


A business owners policy (BOP) is a special type of commercial  insurance designed for small and medium-sized business. When you bundle general liability insurance and property insurance into a single policy, business owners policies typically offer a reduced premium, often making them a more cost-effective option than purchasing these insurance policies separately.  


What does it mean for business owners?  


Let us take a deeper dive into our BOP at Indiana Farm Bureau Insurance. A business owners policy is also a building owner’s policy that offers comprehensive property and liability coverage along with coverages specifically designed for your special business needs. In addition to protecting your company’s structures and contents, the policy also can help cover the actual loss of income your business would sustain in case you would need to temporarily close due to damage.  

BOP data protection coverage  


What makes our BOP unique is those coverages within the policy limits that are included without any special endorsements. Our data breach coverage: expenses associated with breach notification expenses, forensic investigation expenses and public relations expenses are automatically included in the policy; cyber extortion coverage, which reimburses for your business expenses if hit by a covered ransomware attack or other cyber extortion, is also included within the BOP. 


A typical business owners policy also includes property and liability insurance. The property insurance portion of a BOP is available most often as named-peril coverage, which provides compensation only for damage caused by specific events (perils) listed in the policy (typically fire, explosion, wind damage, vandalism, and smoke damage, for example). Some BOPs offer open-peril or “all-risk” coverage; this option is available from the “special” BOP form rather than the “standard.”  

Types of property covered by a BOP usually include:   

  • Buildings: Owned or rented business premises, additions and additions in progress and outdoor fixtures.  

  • Personal business property:  items owned by the business or business owner or owned by a third party but kept temporarily in the care, custody or control of the business or business owner. To be covered by a BOP, business property must be stored or kept in specified proximity of business premises.   

In addition, many business owners policies include business interruption insurance as part of their property coverage. Business interruption insurance can provide up to 12 months of income for businesses if they are forced to cease operations because of a covered property event. 


How much does it cost?  


Many ask what the average cost of business owners policy is? It depends on the coverage limits, endorsements and optional coverages, but our typical BOP costs around $1,000 a year. Some cost more, some cost less depending on the coverage limits and exposure.   


Indiana Farm Bureau Insurance determines annual premiums for business policies by evaluating businesses on an individual basis. That way, your company pays for the appropriate amount of coverage for the size and nature of your business. Business policies are all tailored premiums based on the anticipated exposures and size of your business. Premiums for some commercial policies are determined by payroll or sales dollars.  


Develop a business insurance plan you can rely on. Let us help you take care of your business insurance needs – work with our team to develop an insurance plan that can cover everything from your auto and liability to property and worker's compensation. Although there may be risks in the business world, purchasing a business owners policy is not one of them.  

How to get business insurance or a free quote  


Speak with one of our professional agents or request a quote online. Our knowledgeable agents are available to help you evaluate the coverage you currently have and make recommendations tailored to your individual needs and exposures.   


Who is not eligible for BOP?  

Our BOP is not for everyone. Not all businesses qualify for this policy. Specific coverages included in a business owners policy can vary among insurance providers, but most policies require that businesses meet eligibility criteria to qualify.   


Our requirements depend on business location, the size of the location, revenue and most importantly the class of business. Reach out to an agent to learn more about your business’s eligibility.   

*The information in this article was compiled from a variety of sources and is intended to provide helpful tips only.