When Do I Need to Have a Business Owner’s Insurance Policy?

This is not the kind of question most people are eager to ask when they begin their business.  How about you?

If you own and operate your own business, you most likely began your journey with a dream to make the world a better place – and make a buck in the process – while doing what you love. 

It doesn’t take long before reality barges into your dream like a common cold that can’t be cured and won’t relent. 

You just have to figure out how to live with it. 

Finding the right insurance for your small business can be like a runny nose that won’t go away. 


If you have the right insurance agent by your side, obtaining a business owner’s policy can be inspiring and help your business grow. 

What is a Business Owner’s Policy?

This particular form of insurance is designed to provide small and medium-sized businesses with a package of insurance coverages to protect against common risks and liabilities.

A Business Owner’s Policy (BOP) typically includes three types of coverage:

  1. Property insurance: This covers the physical assets of your business, such as the building, equipment, and inventory, against damage or loss from covered perils such as fire, theft, and vandalism.
  2. Liability insurance: This is designed to protect a business from legal claims against your business, such as bodily injury, property damage, or personal injury that occurred due to the business’s operations.
  3. Business interruption insurance: This provides coverage for the loss of income and extra expenses that your business may incur if it is forced to shut down temporarily due to a covered loss.

The coverage provided by a BOP can vary depending on the needs of the business, and additional coverages can be added as needed.

BOPs are typically less expensive than purchasing separate policies for each type of coverage.  It’s the difference between ordering a-la-carte and upgrading to the “value meal.”   

You should be aware that not all businesses may be eligible for a BOP, and the specific coverage and limits of a BOP can vary depending on the insurer and the state where your business is located.

Do All Businesses Need a Business Owner’s Policy?

Nope!  A BOP is not like auto insurance.  You can own a business and not have it insured. 

But depending on your state, industry, or business size, you may be required to carry certain types of insurance. 

For example, you will most likely need worker’s compensation if you have employees.   

In other cases, your business may be required to carry a minimum of liability insurance. 

If you’re unsure about your BOP needs, you can take two steps today. 

Check your state’s insurance department website.  If the information on the site is unclear, you will likely be able to reach a staff member with a phone call. 

A second step is reaching out to a potential insurance agent.  In fact, this could be a great way of helping you find the right agent. 

An insurance agent who understands state laws, business intricacies, and your needs should be able to provide you with all the information you need to make an informed decision. 

How Do I Know When I Should Have a Business Owner’s Policy?

This depends on how much risk you’re willing to take. 

We recommend purchasing a BOP when your business generates enough revenue to make a profit. 

At that point, you have assets to protect that can be at risk from various threats

There are a few key points in a business’ lifespan that tend to be indicators that it’s time to add a BOP.  These include:

  1. Have a physical location: Just like with owning a house, it’s wise to protect your property against damage or loss due to fire, theft, or other covered perils.
  2. Employ staff: In many states, it’s required to carry workers’ compensation insurance to cover medical costs and lost wages if they get injured on the job. 
  3. Interact with customers: You may need liability insurance to protect against claims of injury or property damage caused by your business.  These claims may not be limited to physical interactions but may also include online communication. 

Depending on how many of these boxes your business checks off, a BOP may save you money.  Certainly in the long run, but also in premium costs immediately. 

How Can Insurance Help My Business Grow?

One of the most overlooked benefits of a BOP is the growth it can spur on. 


Confidence.  Encouragement.  Advice in taking calculated risks. 

You’ve lived through pandemics and shutdowns.  “Great resignations” and recessions.  You know how threats can thwart your business.   

The right insurance partner can help you secure the insurance protection you need to take the risk you must to live out your dreams. 

We want your business to succeed.  At the end of the day, our providers are doing the same thing you are – running a business.  Their success is tied to yours. 

In some cases, an insurance agent may help you process if a risk is wise at a particular point in your business’s lifecycle. 

Our insurance partners understand the nuanced nature of specific markets in all 50 states.  We know what neighborhoods carry what level of risk for crime. 

It is our honor to put our decades of experience to work so that you can flourish. 

Don’t Delay!  Reach out Today!

Is your business ready for a BOP?  Are you ready to get the coverage you need to grow the business you dream of? 

If you have employees, are generating revenue, operate out of a physical location, or interact with customers, then now is the time to secure the insurance coverage your business needs. 

We’re eager to process your position with you!  Reach out today for a free consultation.  Our team of friendly experts is here to help you understand your options so that you can be in the best position to operate your business and live your dreams!

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