What Is a Business Owner's Policy (BOP)?
A Business Owner's Policy combines general liability insurance and commercial property insurance into a single, bundled policy. Instead of buying and managing two separate policies, a BOP packages the coverage most small businesses need together — typically at a meaningfully lower combined premium than purchasing each policy on its own.
BOPs are designed specifically for small-to-medium businesses with moderate risk profiles. Larger businesses, high-risk industries, or businesses needing specialized coverage often need policies built outside the standard BOP framework.
What's Included in a Standard BOP
- General liability: Covers third-party bodily injury, property damage, and advertising injury claims
- Commercial property: Covers your building (if owned), equipment, inventory, and furniture against fire, theft, and other covered perils
- Business interruption: Replaces lost income if a covered event forces you to temporarily close
- Optional add-ons: Many insurers let you add cyber liability, professional liability, or equipment breakdown coverage to a BOP for an additional premium
Who Qualifies for a BOP?
Most BOPs are designed for businesses that meet certain criteria:
- Fewer than 100 employees (varies by insurer)
- Under roughly $1-5 million in annual revenue (varies by insurer)
- A physical location, whether owned or leased
- A low-to-moderate risk industry classification
Retail stores, offices, restaurants, salons, and small contractors are all common examples of businesses that typically qualify for a BOP.
BOP Cost by Business Type
| Business Type | Annual BOP Cost |
|---|---|
| Small office / consulting | $500-$1,200/yr |
| Retail store | $800-$2,000/yr |
| Restaurant / café | $1,500-$3,500/yr |
| Salon / personal services | $700-$1,800/yr |
| Small contractor | $1,200-$3,000/yr |
What a BOP Does NOT Cover
- ❌ Employee injuries (requires Workers' Compensation)
- ❌ Professional errors or negligent advice (requires Professional Liability/E&O)
- ❌ Business vehicles (requires Commercial Auto)
- ❌ Cyber incidents and data breaches (usually requires a separate Cyber Liability add-on or policy)
- ❌ Owner or employee health issues (requires health insurance)
Frequently Asked Questions
Yes, in most cases. Bundling general liability and commercial property into a BOP typically saves 10-20% compared to purchasing each policy individually, since insurers price the bundle at a discount to encourage combined coverage.
No — workers' compensation is a separate, state-regulated policy that isn't included in a standard BOP. However, many insurers that offer BOPs also sell workers' comp, so you can often purchase both from the same carrier for convenience even though they're priced and underwritten separately.
Some insurers offer BOPs or BOP-like packages for home-based businesses, though eligibility and included coverage can vary more than for businesses with a dedicated commercial location. If you work from home, ask specifically whether a standard BOP applies to your situation or whether you need a home-based business endorsement instead.