What is a Business Owner’s Policy (BOP) and Do I Need One?

What’s in a Business Owner’s Policy (BOP)?

A BOP is an insurance policy that typically bundles these three coverages:

1. General liability insurance
2. Commercial property insurance
3. Business interruption insurance

Understanding how each policy works will provide a clearer picture of what a BOP includes and how it can help protect your business:

General liability insurance

This foundational coverage helps protect your business from some of the most common risks. For example, if a customer slips on a wet floor in your restaurant or shop and hurts their back, the general liability portion of your BOP insurance policy could help cover their medical bills and any legal costs if they sue you. It also can safeguard against:.

• Third-party property damage
• Personal and advertising injury

General liability isn’t required by federal law, but your state, city, or industry licensing board may have their own rules. Check local requirements to see what’s needed for your business.

Commercial property insurance

Commercial property insurance safeguards the physical assets your business depends on every day. If a fire breaks out in your office, destroying computers, furniture, and important documents, commercial property coverage could help pay to replace those items. It also can help cover damage from:

• Wind, storms, and snow
• Sprinkler leakage and various other water forms
• Vandalism
• Building collapse

While commercial property insurance isn’t always required by law, it may be one of the conditions of your lease agreement. Review your contract to ensure you have the coverage you need.

Business interruption insurance

If a storm damages your restaurant’s roof and you have to shut down for a month for repairs, business interruption insurance could help replace lost income and pay for ongoing expenses such as rent and payroll. It also can help with:

• Temporary relocation
• Fixed costs such as operational expenses
• Loan payments and taxes
• Closure due to damage to a nearby business
• Training costs when new equipment is needed following a loss

As with commercial property insurance, business interruption typically won’t cover flood or earthquake losses. Utilities, pandemics, and other public health events, undocumented income, and broken items from general use are also generally excluded.

Benefits of a BOP Policy

A Business Owner’s Policy is designed with small businesses in mind. And for many owners, it’s a practical way to get comprehensive and affordable coverage without juggling multiple policies.

Key benefits include:

• Cost-effectiveness: A BOP is often less expensive than buying separate policies for general liability, commercial property, and business interruption insurance.
• Convenience: One BOP policy means fewer bills, fewer renewals, and less time spent on insurance paperwork.
• Expanded protection: Coverage for multiple types of risks under one umbrella, reducing the chance of gaps in your protection.

That balance of affordability, convenience, and peace of mind is precisely what appealed to Sandy Hedgpeth, a Simply Business customer who runs Sandy’s Sewing, a busy alterations business in St. Joseph, Missouri.

“My landlord required me to carry insurance, and I realized I needed more than just basic coverage. A Business Owner’s Policy gave me the protection I wanted and the peace of mind I needed — and the extra coverage didn’t cost much more. Plus, the whole process was very simple.” – Sandy, Sandy’s Sewing

Stories like Sandy’s highlight why a BOP can be such a smart choice for small business owners.

Who Should Consider a BOP — And What It Typically Costs

Many small business owners such as Sandy choose a BOP for the extra protection it provides — often at just a slightly higher cost than a stand-alone general liability policy. A BOP may be a good fit if:

• You own or rent a physical location, such as a storefront, office, or workshop.
• You have valuable equipment, inventory, or furniture.
• You want to protect against lost income if your business is forced to close due to a covered event.

Here are a few types of businesses that often benefit from a BOP insurance policy — and what they typically pay when purchasing through Simply Business:

Clothing Stores¹
A neighborhood clothing shop with racks of inventory and steady foot traffic might pay about $71 per month for a BOP policy, depending on your store size, staff, and coverage limits.

Restaurants²
A busy restaurant with commercial kitchen equipment and a steady flow of customers might pay under $150 per month for a BOP policy.

Accountants³
As an example, a small accounting firm with an office space where clients come for consultations may pay about $34 per month for a BOP policy, depending on factors such as location, coverage limits, and claims history.

When General Liability Might Be Enough

Not every small business needs the additional commercial property and business interruption coverage included in a BOP insurance policy. For example, freelancers or consultants working from home — with no brick-and-mortar shop, inventory, or expensive equipment — may be better served by a stand-alone general liability policy with the option to upgrade to a BOP insurance policy as your business grows.

If you have questions about what coverage might work best for you, our licensed agents are available Monday through Friday, 8 a.m. to 8 p.m., at 855-869-5183.

Questions to Ask Your Insurance Provider or Agent

Once you’ve got a sense of whether a BOP insurance policy might be the right fit for your business, the next step is making sure you understand the details. And knowing what to ask can help you compare your options with confidence.

• What are the coverage limits for each type of insurance within a BOP?
• Are there any specific exclusions or limitations I should be aware of for my type of business?
• What are the deductibles for each section of the policy?
• Does the policy cover data breaches or cybersecurity incidents?
• How does the business interruption coverage work? 
• What is the process for filing a claim, and what is the typical timeline for resolution?

Is a BOP Right for You? Simply Business Can Help

Figuring out the right coverage can feel overwhelming — especially when you’re comparing policies, weighing costs, and trying to make sense of the fine print. That’s where we come in.

By offering a wide range of insurance options, Simply Business helps small business owners find coverage as unique as the businesses themselves. With a convenient online quote tool that’s available 24 hours a day, 7 days of a week, you can have a quote ready in just a few minutes. 

Your small business BOP doesn’t have to be complicated. We make it simple.

1. _{Data from Simply Business customers identifying themselves as a “clothing/apparel store” owner who purchased a BOP from July 1, 2024 to December 31, 2024.} ↩︎
2. _{Data from Simply Business customers identifying themselves as a “restaurant” owner who purchased a BOP from July 1, 2024 to December 31, 2024.} ↩︎
3. _{Data from Simply Business customers identifying themselves as an “accounting” business owner who purchased a BOP from July 1, 2024 to December 31, 2024.} ↩︎