Businessowners Policy and Other Specialty Coverages
BOP basics
The Businessowners Policy is a packaged product for small and medium businesses - offices, retail, service operations, and apartment buildings within stated eligibility limits. It bundles property (usually special form, including business income) with general liability similar to the CGL, plus optional coverages such as outdoor signs, money and securities, employee dishonesty, equipment breakdown, and spoilage. Ineligible classes typically include auto dealers, bars and taverns, gambling operations, and large or unusually hazardous risks.
What the BOP does not include
Workers compensation, commercial auto, professional liability, and flood. Those require separate policies or endorsements.
Specialty coverages
- Flood - excluded by property forms; written through the NFIP or a private carrier. NFIP has a 30-day waiting period, separate building and contents limits, and replacement cost only for the primary residence.
- Earthquake - usually by endorsement with a percentage deductible.
- Inland marine - property in transit, bailee coverage, fine arts, equipment floaters.
- Crime - employee dishonesty, forgery, computer fraud.
- Umbrella/excess - pays after underlying limits and can drop down for some exposures.
- Professional liability/E&O, D&O, EPLI, cyber - liability for services, management acts, employment practices, and data breach.
- Surety bonds - three parties: obligee, principal, surety.
Worked example: A client asks whether the BOP covers a burst pipe - yes. Whether it covers rising water flooding the store - no, flood is excluded and requires a separate policy.
Trap: do not assume the BOP automatically includes ordinance or law, spoilage, or equipment breakdown; they are typically optional.