Business Owners Policy (BOP) - GL, Property, and Business Interruption in One Package

What a BOP Includes

A standard BOP bundles three coverages into one policy form:

General liability. Covers third-party bodily injury and property damage claims arising from your business operations. A customer slips in your store. A visitor trips over equipment in your office. A delivery person injures themselves on your property. GL handles these claims - defense costs, settlements, and judgments up to your policy limit. Standard BOP limits are typically $1M per occurrence / $2M aggregate.

Commercial property. Covers your building (if you own it), business personal property, inventory, furniture, equipment, and tenant improvements. Covered perils include fire, windstorm, hail, theft, vandalism, and several others. The policy pays to repair or replace damaged property up to the limits you set.

Business interruption. Covers your lost income and continuing operating expenses when a covered property loss forces you to shut down temporarily. If a fire closes your location for three months, business interruption pays the income you would have earned during that period plus fixed expenses like rent and loan payments.

Many BOP policies also include or offer as add-ons:

• Data breach / cyber incident coverage. A small sublimit for first-party data breach expenses. This is a starting point, not a substitute for a standalone cyber liability policy if you handle significant customer data.
• Hired and non-owned auto. Liability coverage when employees drive their personal vehicles or rental cars for business purposes. This does not replace commercial auto insurance for company-owned vehicles.
• Employment practices liability (EPLI). Some BOPs offer a small EPLI sublimit for employment-related claims like wrongful termination or discrimination. Again, this is a starting point - not a substitute for standalone EPLI if you have significant employee count.
• Equipment breakdown. Covers mechanical and electrical failure of equipment - boiler explosion, motor burnout, electrical surge damage.
• Inland marine. Limited coverage for business property away from your premises. Tools, equipment, or materials in transit or at temporary locations.

Who a BOP Works For

BOPs are designed for small to mid-size businesses with relatively straightforward risk profiles. Carriers have eligibility requirements - not every business qualifies. Typical BOP eligibility looks like this:

• Revenue under $5M. Most carriers cap BOP eligibility at $3M to $5M in annual revenue. Above that, you typically need standalone policies.
• Fewer than 100 employees. Most BOP programs are designed for businesses with smaller workforces.
• Less than 25,000 square feet. The premises size limit varies by carrier, but most BOPs are built for smaller locations.
• Lower-hazard occupancies. Offices, retail stores, professional services, small restaurants, and light manufacturing typically qualify. Heavy industrial, large-scale construction, and high-hazard operations usually do not.

Businesses that are a strong fit for a BOP:

• Professional offices. Accountants, attorneys, consultants, real estate offices, and insurance agencies. Low property values, low liability exposure, straightforward operations.
• Retail stores. Small to mid-size retail with inventory, a storefront, and customer foot traffic.
• Restaurants and food service. Smaller restaurants and cafes that fall within the carrier's eligibility. Larger restaurants may need standalone policies for higher property values and specialized equipment.
• Service businesses. Cleaning companies, salons, repair shops, and other service-oriented businesses with a fixed location.
• Small contractors with a shop. Contractors who operate from a fixed location and need property and liability coverage for their shop or office. Your field operations and job-site work may still need separate general liability and inland marine coverage depending on your trade.

What a BOP Does NOT Include

A BOP covers a lot, but it does not cover everything. These coverages require separate policies:

• Workers compensation. Required by law in almost every state if you have employees. A BOP never includes workers comp - it is always a standalone policy.
• Commercial auto. Company-owned vehicles, fleets, and commercial trucking need their own auto policy. The hired and non-owned auto endorsement on a BOP only covers liability when employees use personal or rental vehicles for business.
• Professional liability (E&O). If your business provides professional advice, design work, or consulting services, your E&O exposure is not covered by a BOP. You need a standalone professional liability policy.
• Umbrella / excess liability. If you need higher liability limits than the BOP provides, you need an umbrella or excess policy to sit on top.
• Cyber liability. While some BOPs include a small cyber sublimit, it is not a substitute for a dedicated cyber policy if you store customer data, process payments, or rely heavily on technology.
• Flood and earthquake. Just like standalone property policies, BOPs exclude flood and earthquake damage. These need separate policies or endorsements.

BOP vs Separate Policies - When to Use Each

The BOP exists because most small businesses need the same three coverages - GL, property, and business interruption - and bundling them saves money and simplifies administration. For qualifying businesses, a BOP is almost always the right starting point.

Choose a BOP when:

• Your business falls within standard BOP eligibility (revenue, headcount, square footage)
• Standard policy limits meet your needs
• Your risk profile is straightforward
• You want one policy with one renewal instead of managing three separate policies

Choose standalone policies when:

• Your revenue exceeds the carrier's BOP threshold
• You need higher limits than the BOP offers
• Your operations require specialized coverage forms or endorsements
• You have multiple locations with different risk profiles
• Your property values are high enough to warrant a dedicated commercial property policy with custom terms

When You Outgrow a BOP

A BOP is built for small to mid-size businesses. As your business grows, you will eventually hit a ceiling where the BOP no longer fits. Signs you have outgrown your BOP:

• Revenue exceeds the carrier threshold. Most carriers cap BOP eligibility at $3M to $5M. Once you pass that line, you move to standalone policies.
• You need higher GL limits. Standard BOP GL limits are $1M/$2M. If your contracts require $2M/$4M or higher, you may need a standalone GL policy or an umbrella.
• Your property values have grown significantly. The BOP property form works well for smaller values. Once your building, equipment, and inventory values climb into the millions, a standalone commercial property policy gives you more control over coverage terms, deductibles, and valuation methods.
• You need specialized endorsements. Pollution liability, professional liability, contractor-specific endorsements, or other specialty coverages that the BOP form does not accommodate.
• Multiple locations. Managing multiple locations on a single BOP can work up to a point. As the portfolio grows, standalone policies with scheduled locations give you better control.

Outgrowing a BOP is a good sign - it means your business is growing. The transition to standalone policies is straightforward and gives you more flexibility as your insurance needs get more complex.

How Much Does a BOP Cost?

A BOP is typically 10% to 15% cheaper than buying GL, property, and business interruption separately. General premium ranges:

• Small businesses (home-based or low-value location): $500 to $2,000 per year
• Mid-size businesses (storefront, office, or small shop): $2,000 to $5,000 per year
• Larger qualifying businesses (higher property values, more inventory): $5,000 to $10,000+ per year

The premium depends on your business type, property values, revenue, location, and claims history. The bundled discount makes the BOP one of the most affordable ways to get your core coverages in place.

Frequently Asked Questions

Can I add workers comp to my BOP?

No. Workers compensation is always a separate, standalone policy. It is governed by state law with specific rating rules, and it cannot be bundled into a BOP. You can buy both from the same carrier in many cases, but they will be separate policies with separate premiums.

Is a BOP the same as general liability?

No. A BOP includes general liability, but it also includes commercial property and business interruption coverage. If you only buy a GL policy, you have no coverage for your building, equipment, inventory, or lost income from a property loss. A BOP gives you all three in one package.

Do contractors need a BOP or standalone policies?

It depends on the contractor. Small contractors with a shop or office who have low to moderate risk may qualify for a BOP. Contractors doing field work on job sites, working on large commercial projects, or bidding public works typically need standalone general liability, commercial property, and often inland marine coverage with contractor-specific endorsements that a BOP does not offer.

Get a BOP Quote

If your business needs general liability, property, and business interruption coverage - and most businesses do - a BOP is the simplest starting point. One policy, one premium, and you have the core protections in place.

The Grit team will tell you straight whether a BOP fits your business or whether standalone policies make more sense. We do not sell you the cheaper option if it leaves gaps, and we do not sell you standalone policies when a BOP does the job.

Call us at (801) 505-5500 or request a quote online.