We recently talked about the magic that is a business owner’s policy (aka BOP) and how they make insurance wonderfully convenient for businesses. But it’s important to note that there are some things that simply aren’t covered in a business owner’s policy. BOPs (catchy nickname, right?) cover general liability, commercial property, and business interruption insurance. However, the risks covered by the three types of insurance bundled into a BOP may not be enough to fully cover your business. There are lots of other disasters out there. To help you ensure that your business is fully insured, we’re going to go over some coverages and losses that aren’t bundled into a BOP.
Coverages that need to be purchased as separate policies:
There are some coverages that can’t just be tacked onto a BOP. They need to be purchased as separate policies for your business. Here are some coverages that you might want (or need) to get for your business.
Workers’ comp insurance is essential for businesses. It protects your employees if they get hurt or get sick because of their jobs. It will provide them with medical payments so that they can get back on their feet. It also reimburses them for a portion of the wages that they lost while they weren’t able to work if they’re medically approved to take time off. Depending on your business and state, you might be required to carry workers’ comp insurance.
Flooding is not covered by a business owner’s policy. If you want to get flood insurance for your business, you’ll have to purchase it separately from the National Flood Insurance Program through an agent. Flooding is one of those disasters that isn’t covered by most insurance policies, not even commercial property.
Group health insurance and disability insurance:
These coverages must be procured separately if you want your employees to be able to get health insurance through their jobs. They cannot be tacked onto a BOP.
Coverages that you can add to your BOP:
BOPs can bundle more than general liability, property, and business interruption insurance. There are other types of insurance that can be added to a BOP policy if you so choose. Some of those coverages are…
Crime coverage includes protection for a variety of theft that your business could face, including employee theft. Usually, you can add between $1,000 and $5,000 of coverage to your policy.
Data breach coverage:
With how dependent businesses are on technology and computers, data breaches are a very real risk. Adding data breaches to your BOP will help your business with the costs of…
- Telling people who have had their information stolen from your company that their information has been stolen from your company.
- Hiring consultants who can help you sort out the ensuing chaos.
- Defense and settlement costs from potential lawsuits.
- Replacing income that you lost due to the breach.
- Extortion/ransom (Believe it or not, holding computer files or systems hostage and demanding money for their release has become a favorite of hackers, as far-fetched as it may seem. It’s a real thing.)
Errors and omissions coverage:
Any business that provides services for a fee is susceptible to being sued. Customers who believe that they were harmed by the business’s advice or services could bring a suit against the business for nor doing its job properly. E&O insurance will pay the costs that the insured business is legally obligated to give to the injured party, up to the policy’s limit. It will also cover defense costs.
It’s important to make sure that you understand exactly what your BOP will and won’t cover. If there are any areas of risk that are not included in your BOP, you need to fill your coverage gaps. Disasters have a nasty habit of striking those areas that aren’t protected by insurance. Don’t underestimate the power of Murphy’s Law – whatever can go wrong, will go wrong. You don’t want to fall prey to a loss that isn’t covered, so review your insurance carefully and bolster any areas that are missing coverage.
Do you need to get some business insurance? We’d love to help you out with that! We can help you identify the risks that your business faces and build an insurance plan to protect you from them. We can get you some business insurance quotes for free. All you have to do is fill out our online quote form or give us a call today.