Business owners face a lot of risks when it comes to launching a company and operating day to day. Accidents, natural disasters, storms and lawsuits can all cost companies thousands or even millions of dollars. This is why business owners invest in a business insurance policy. Not all policies are created equal, however.

A business owners policy is a commercial policy that bundles important coverages specifically geared for small businesses in low-risk industries.

What Qualifies as a Small Business?

The definition of a small business varies depending on your industry. The size of a business is generally calculated based on the number of employees and the annual income of the business. It also matters about the number of your business’ affiliates. If your business has large affiliations that owns 50 percent or more of your business, it may affect how the size of your business is determined.

What is a Low Risk Industry?

Risk refers to how likely you are to file a claim on your insurance policy. The more likely your business is to file a claim, the higher risk your industry may be. There are many different areas of risk, as well. Some industries such as accounting and medicine are considered high risk due to the likelihood of a lawsuit, which would be covered by liability insurance. Other businesses may be considered high risk for injuries or damages, such as entertainment businesses with physical activities.

Low risks industries may include:

• Sales
• Tutoring
• Virtual assistant
• Customer service
• Senior care

Be sure to ask an insurance agent about your qualifications as a small or low risk business.

What Does a BOP Cover?

A BOP should be purchased by a business owner to cover the business as a whole and the employees within. A basic BOP includes two important coverages:

• General Liability: General liability insurance covers bodily injury and property damage someone else may suffer as a result of everyday work activities, such as someone slipping and falling in your store. This can cover medical bills as well as lawsuits concerning nonprofessional negligence.
• Commercial Property: Commercial property insurance covers the physical assets of your business such as the physical location and its contents in case of loss or damage due to fire, wind, hail, lightning, smoke, theft, vandalism and more.

BOPs are customizable, as well, allowing business owners to add coverages and set limits as needed for their specific business.