BOP Insurance in Massachusetts

Get a Quote
Many businesses, like dry cleaners, are good candidates for BOP insurance coverage

What is BOP insurance?

A business owner’s policy (BOP) is a simplified bundle of at least two essential business coverages. It’s designed for small businesses in certain low-risk industries (see more on who is a good candidate for a BOP is below). By combining several policies into one, some businesses can meet their primary insurance needs and save money, rather than buying each coverage individually.

Typically, a BOP bundles together key coverages like general liability, business income, and commercial property. Companies can also purchase add-on coverages to supplement a basic BOP. Notably, a BOP does not include workers’ compensation insurance or commercial auto coverage, but if a company will provide you with one, they may write these coverages as well and help you leverage policy bundling discounts!

Companies with higher and/or more complex risks should be on a tailored policy.

A BOP is also designed for businesses with less complexities. For example, a landscaper who only handles lawncare is a good candidate for a BOP. A landscaper who also builds outdoor buildings, plows snow in the winter, etc. may need coverage beyond a BOP.

What Is Typically Covered Under BOP?

There are two main types of coverage that every BOP will include, regardless of where you buy it:

1. Commercial Property Insurance
If you own or rent space to conduct your business, the commercial property portion of your BOP can help protect you against certain types of a physically-damaging disasters. The most common of these include fire, windstorm, explosion, burglary, riots, and vandalism. In addition to protecting your building’s structure, property coverage also includes building contents (things like furniture, computers, equipment, and product inventory).

Keep in mind though, with a BOP, as with any insurance policy, details are very important. Exclusions often apply. BOPs usually include some limited coverage for electronic data and computer equipment as an additional coverage

2. General Liability Insurance
“General liability” is coverage that protects you against third-party claims. A third party is anyone who doesn’t work for your company. It could be a client, a competitor, or a member of the public.

Potential claims could include bodily injuries (someone slipped and fell in your parking lot); damage to personal property (your ladder crashed through someone’s window); or allegations of false advertising/libel/slander (your intern posted on Facebook that ABC Competitor has a rat problem in their kitchen). General liability is designed to step in —in all of these cases — and help to pay your legal defense and/or financial settlement, up to a preset limit.

NOTE: if you don’t qualify for a BOP, you can buy general liability insurance all by itself, or as part of a different type of commercial insurance package.

Your BOP may also include business income insurance and extra expense, also known as business interruption insurance, which protects against financial losses when a business is unable to operate. Business income insurance covers lost revenue so a company can continue to pay their employees, mortgage, etc. Extra expense covers whether a business needs to rent a temporary building while the original property is being renovated or rebuilt.

What Is Not Included in a BOP?

Policies vary, but with a BOP alone, you will not receive coverage for:

There may be other noteworthy omissions, too, depending on your unique risk profile.

Additional Customizations You Can Add to Your BOP

Customizations will be different for every business, depending on where you work and what you do. Some common endorsements or add-ons to BOP coverage may include:

  • Business Crime/Employee Theft Insurance – coverage that protects your business from various types of employee theft, including payroll fraud, forgery, embezzlement, and more
  • Employment Practices Liability Insurance (EPLI)  – coverage that reimburses you for legal defense costs and/or settlements arising from claims of discrimination, wrongful termination, sexual harassment, and more
  • Cyber Insurance – coverage that can help your business recover from a cyber attack, including phishing scams, ransomware attacks, and third-party liability claims from lost personal information.
  • Water/Sewer Back-up Insurance

There are many other coverages you may need to consider, specific to your industry and your operation. Not all of them are available as endorsements to a BOP. (Worker’s comp and commercial auto, for example, are essential for most businesses.) Instead, you may need to purchase these add-ons separately, or bundle them into a different type of commercial insurance package.

Are All BOP Policies the Same?

No! Definitely not. This is an important point to keep in mind when browsing for business insurance — especially if you’re shopping for a BOP quote online. Many small business owners and startups are tempted to accept the first insurance quote they find. The problem is that business insurance requires expert advice, ideally from a local agent who insures other companies like yours, in your state.

Some BOPs, for example, will only cover “named perils” for property damage. That means if the type of loss event (fire, wind, vandalism, theft) isn’t specifically listed on your policy, your insurance company won’t cover it. Others — known as “all-risk” or “open-peril” BOPs — come with broader coverage terms. They cover all types of general liability and property claims except for those that are specifically excluded.

So, which type of BOP should you buy? An experienced agent is a great source of information, when it comes to combing through potential losses, deciding what’s important, and understanding how BOP insurance will or won’t respond.

Who Needs BOP Insurance?

We mentioned earlier that BOPs typically apply to small, low-risk businesses. Retail stores, barber shops, beauty parlors, fitness centers, churches, dry cleaners, and certain types of contractors: these are all potential candidates for a BOP.

On the other hand, businesses that routinely encounter more serious risks — bars or nightclubs, roofing companies, utility contractors, snow removal contractors, arborists, etc. — will likely need a more tailored commercial insurance package.

What are the Benefits of BOP Insurance?

  • A BOP is typically more affordable than buying separate policies.
  • You have the ability to easily add additional coverages.
  • Insurance companies will usually consider offering business auto, umbrella, and workers’ compensation quotes to maximize multi-line premium discounts

How Much Does BOP Insurance Cost?

The cost of BOP insurance is primarily a function of your company’s size, industry (i.e., how risky your work is), and prior loss history. Your desired coverage limits also play a role, as does the scope of your property. Companies with few employees and modest sales need less insurance and therefore pay less in premium. Likewise, companies with smaller footprints (small office, one computer) pay less than those with large, equipment-filled warehouses and multiple locations.

Here’s a list of key factors that could impact your BOP premium:

  • General liability class code (riskier types of work will raise your premium)
  • Prior loss history (size and nature of insurance claims filed in the past)
  • Coverage limits (opting for higher limits could raise your premium)
  • Replacement cost value vs. actual cash value coverage (opting to insure your property for what it’s worth brand new vs what it’s worth right now)
  • Size (square footage) and number of commercial properties
  • Value of business contents/business personal property
  • Any loss control measures in place (security systems, safety training, etc. could help to reduce your premium)

FAQs

Q: What is business owner’s policy (BOP)?
A: A BOP is a simplified bundle of at least two essential business coverages designed for small businesses in certain low-risk industries, with specialized pricing over other liability and property policies

Q: What does a business owner’s policy cover?
A: Typically, a BOP bundles together key coverages like general liability and commercial property. Companies can also purchase add-on coverages to supplement a basic BOP.

Q: Is BOP insurance right for my company?
A: Great question. The best way to find out is to contact a licensed, local agent — like the ones who make up our commercial lines team. Here at C&S, we’ve been advising Massachusetts business owners for 60+ years. Connect with us at 508-339-2951.

Q: How much does a BOP cost?
A: It depends on the type of risk and the type of company. Other factors that will affect the price include a company’s loss history, the size of the business, and how many buildings the company owns. There are a lot of factors, and every business is different, so give us a call, and we’d be happy to walk through the specifics in order to give you an estimate.

Q: What is business personal property?
A: This refers to any property your company owns within your business, which can include stock, materials, ingredients, betterments and improvements, and property located outside and within a specified distance to the building, etc.

Q: What’s the difference between a business owner’s policy and general liability coverage?
A:  General liability protects against third-party claims involving bodily injury and/or property damage that may occur on a job or business site. At minimum, BOPs include general liability coverage and property coverage.

C&S Insurance is Your Trusted Choice for BOP Insurance

If you own a business in Massachusetts, our team is the ideal partner for you. Here are just a few reasons why:

We have access to all the top carriers for business insurance. This means we can give you more options than other agencies. More options mean more competitive pricing and, quite often, better terms.

We maintain a dedicated Claims Department, so there’s always someone on hand to support you when something goes wrong. A dedicated claims department also means your claims get closed out faster, which is key to maintaining a healthy loss history.

We offer in-house registry services and RMV “runners.” This means fewer trips to the RMV for most of our clients, and a lot less hassle managing your Massachusetts commercial plates.

Our team of commercial agents are among the best in the business. You won’t find a more dedicated, knowledgeable crew anywhere in the Bay State. So, let us work for you. Contact us today for more information or to get started!