What does a business owners policy cover?
|
 |
Insurance companies generally sell business insurance policies that combine protection from all major property and liability risks in one package. Naturally they sell the coverages separately as well. One package purchased by small and mid-sized businesses is the business owners policy (BOP). Package policies are created for businesses that generally face the same kind and degree of risk. Larger companies might purchase a commercial package policy or customize their policies to meet the special risks they face.
|
What does BOP include?
|
|
| Property insurance for buildings and contents owned by the company. |
| Business interruption insurance |
Liability protection
|
|
|
What coverages are not included by BOPs.
|
|
BOPs do not cover professional liability, auto insurance, workers compensation or health and disability insurance.
|
|
How can I disaster-proof my business?
|
|
|
You can minimize the risk of damage in advance of an emergency by: |
|
| Training employees in fire safety, housekeeping, maintenance and operations where open flames or flammable substances are used. |
| Modernize the electrical system since faulty wiring causes a large percentage of nonresidential fires. |
| Situate your business in a fire-resistant building with a fire alarm system and a good sprinkler system. |
| Limit storm related damage by making certain the building conforms to damage resistant building codes. |
| Keep up-to-date records of both computerized and written records. |
Develop a disaster plan just in case.
|
|
Do I need business interruption insurance?
|
|
Business interruption insurance can be as vital to your survival as a business as fire insurance. Most people would never consider opening a business without buying insurance to cover damage due to fire and windstorms. However, too many small business owners fail to think about how they would manage if a fire or other disaster damaged their business premises so that they were temporarily unusable. Business interruption coverage is not sold separately. It is added to a property insurance policy or included in a package policy.
|
|
What does business interruption insurance include?
|
Business interruption insurance compensates you for lost income if your company has to vacate the premises due to disaster-related damage that is covered under your property insurance policy, such as a fire. BI insurance covers the profits you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt.
|
|
What is extra expense insurance?
|
Extra expense insurance reimburses your company for a reasonable sum of money that it spends, over and above normal operating expenses, to avoid having to shut down during the restoration period. Usually, extra expenses will be paid if they help to decrease business interruption costs.
|
|
Are there any disasters my property insurance won’t cover?
|
Yes. Floods, earthquakes and acts of terrorism or war are generally not covered. However, you can obtain additional policies that cover against flood damage, earthquake damage and losses arising from terrorist acts. The exception is workers compensation, which covers injuries and deaths due to acts of terrorism.
|
|
Do I need workers compensation insurance?
|
Employers have a legal responsibility to their employees to make the workplace safe. However, accidents happen even when every reasonable safety measure has been taken. To protect employers from lawsuits resulting from workplace accidents and to provide medical care and compensation for lost income to employees hurt in workplace accidents, in almost every state, businesses are required to buy workers compensation insurance. Workers comp covers workers injured on the job, whether they are hurt on the workplace premises or elsewhere, or in auto accidents while on business. It also covers work-related illnesses.
|
|
What does workers compensation insurance pay to the employee?
|
Workers comp provides payments to injured workers, without regard to who was at fault in the accident, for time lost from work and for medical and rehab services. It also provides death benefits to surviving spouses and dependents.
|
|
Can Workers compensation insurance be purchased separately?
|
Yes. A workers comp must be bought as a separate policy. Although in-home business and BOPs are often sold as package policies, they don’t include coverage for workers injuries.
|
