Business Owners Policy: What is It and Why Do You Need It?

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If you own a small to medium-sized business with commercial property and are concerned about your financial responsibility in the event of property damage or a personal injury, a business owners policy may be just the ticket. A business owners policy typically provides two types of coverage:

Business Owners Policy: What is It and Why Do You Need It?

  • Liability. While a business owners policy does not provide coverage for your employees, it does include protection against liabilities in the event of a fire, theft, customer injury, property damage, or someone making a product-related claim.
  • Property. A business owners policy provides coverage for commercial buildings and any movable business personal property owned by and used for the business. If you sustain a covered loss, the policy can also pay for other things like removal of debris, loss of income and pollution cleanup. Earthquake damage is not typically covered by a business owners policy, and if you live in an earthquake-prone area, you may want to consider extending your coverage by adding an endorsement to your policy.

Depending on the type of business you own and your unique needs, optional coverage may be available. Customizing your business owners policy from the get-go will help ensure that you are protected against loss or damage. Two popular optional types of coverage you may want to consider are data breach coverage and professional liability coverage. Theft of personal information is common and can really damage your company’s reputation if not dealt with in a timely manner. Data breach coverage can help pay for expenses such as notifying affected individuals, public relations, and lawsuits. Professional liability coverage can offset costs in the event that you are sued by a customer claiming that your business has been negligent or made errors in professional services.

Many insurance companies offer a business owners policy tailored to cover the most common risks for various industries, such as auto, food, service, and retail. Check with your insurance company to review the policy they have designed for your specific industry.

If you think purchasing a business owners policy could benefit your small business, our seasoned professionals have the knowledge and experience to help you choose the policy that best fits your needs. Please give us a call at All American Insurance Brokerage today!