Underground Journal

Commercial Insurance and the Business Owner’s Policy

A business owner’s policy is a type of commercial insurance that is appropriate for small to mid-sized business owners. It is a multi-purpose type of insurance that covers risk exposure due to potential property damage, lawsuit liability, and unforeseen events that might interrupt normal business operations.

Employees or consultants who are conducting either a normal part of their business duties or are taking a reasonable detour, which means if your employee stopped to get a cup of coffee and then run into a parked car, you are still liable for their actions. This example illustrates why proper business liability insurance, in particular, is so important.

If your place of business is damaged or destroyed, property insurance will cover the amount for repair or replacement up to your policy maximum, though you should examine your commercial insurance policy to analyze their exceptions to this coverage – for example, natural disasters are commonly excluded from property protection.

There are several important restrictions on being able to fall under the qualifications of a business owner policy, mostly limiting the size of the business and the type of business activity being conducted.

First, if the business is in an office building, it must be less than four stories tall, and if it is located inside an apartment building, it has to comprise less than 60 apartment units in a building less than seven floors tall. For any other type of building, floor space can’t be larger than 7500 square feet.

Additionally, there are broad restrictions on the types of businesses that can qualify for a business owner’s policy – for example, eating places, including bars, vehicles including motor homes, condos, and places where manufacturing take place are all excluded from participating.

A good commercial insurance provider will explain to you exactly what is and what isn’t covered under the policy you’re considering. There are a wide array of additional coverage categories and umbrella policies to increase existing coverage, so you can manage your business’s risk precisely and accurately.

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