Is your small business eligible for a business owner's policy?

If you do business for a profit, you are eligible for a business owners policy. Business owners policies are available to any individual who is exposed to work hazards, including employment hazards, lawsuit or liability exposures. Depending on the size of your business and where you work, you will be eligible for a specific type of insurance plan. For example, if you are a sole proprietor working from home, you can add a business owners line to your home owners policy. Your business policy will be tax deductible and you will receive basic coverage. 

Do You Need a Business Owner's Policy for Your Small Business?

You may not see the immediate need for a business owners policy, but any individual should consider the coverage. This is particularly true if you work from home or have a small personal business. Consider the following:

  • What would happen if you were sued for a copyright infringement for your website?
  • What if you were sued for defamation for a critical blog post?

All of these scenarios occur daily. Consider these reasons for obtaining a business owners policy:

  • Protection from lawsuit
  • Protection of any property used to supply your business or help you turn a profit
  • Protection in case you or one of your employees becomes injured or ill on the job
  • Tax deductions available to you for purchasing the policy or officially incorporating your business
  • Protection in the case your business is no longer viable and must declare bankruptcy
  • Ability to market your business as "licensed, insured"

If you do not have a business owners policy, you are personally responsible for the actions of your business. Your business policy can offer protection in the case your business encounters financial issues or other difficulties.

What is business owner's policy (BOP) insurance?

Business owners policy insurance protects you personally if your business is involved in a property or liability claim. For example, a photographer working from home may think they have no insurance needs. However, what would happen if this photographer displays a photo in a portfolio and a subject in that photo did not give permission? The subject could sue the photographer, and in the absence of a business owner policy, the photographer would be responsible for all costs for the lawsuit and any resulting settlement. A business owners policy offers a delineation between the owner and the business.

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