When shopping for small business insurance, it's important to understand the difference between General Liability Insurance (GL) and a Business Owner's Policy (BOP). Knowing what each policy covers will help you make the best financial decision on how to protect your business.
General Liability Insurance protects you and your business from "general" claims involving bodily injuries and property damage. In many cases, General Liability Insurance is a requirement for financial lenders, landlords or licensing boards. If a third party is injured while doing business with you, your General Liability Insurance will protect you from having to pay out of pocket for the injured party's medical and repair bills, plus your legal fees if they sue. But as the word "liability" implies, it typically only covers the cost of damage your business causes to others.
General Liability Insurance covers:
General Liability Insurance does not cover work place injuries that happen to employees or other people on your payroll. And GL does not cover professional liability/professional services. This is generally covered by Workers' Compensation. It also does not cover the cost of damages to your own business property. Typically, it only helps cover the costs of damage your business causes to others. Commercial Property Insurance is designed to help cover the cost of damage done to your business' property and must be purchased separately.
A Business Owners Policy (BOP) is designed for small-or medium-sized businesses and bundles General Liability Insurance and Commercial Property Insurance into one product. A BOP policy includes the same liability protection as a General Liability Insurance policy; however, it also offers coverage to protect your company property, assets owned and used by your business and lost income due to business interruption related to those losses. BOPs are a good option for small businesses looking to bundle more complete insurance, and for savings, as it's often cheaper to purchase a BOP policy than to buy each policy separately.
BOP does not provide auto insurance, workers compensation or disability insurance. You'll need separate insurance policies to cover these for your business. Also, Professional Services Liability Coverage is not included, unless selected where available.
Both General Liability Insurance and BOP protect your business from liability. But if you're looking for more coverage and want to save money on small business insurance, a BOP policy is a smart choice. Many insurance carriers offer BOP at a discounted rate - costing less than what you would spend on a standalone policy. As a business owner, you can benefit by protecting yourself from unexpected financial losses in one convenient package designed specifically for small-and mid-sized businesses that offers a broad range of coverage.
How to purchase a BOP policy from Stillwater: