Small Business Insurance - Business Owners Package Basics

 Every small business needs good insurance policies. These policies cover your small business when bad stuff happens. You need to be covered for accidents that are your fault as well as situations created by others. The coverages on a small business insurance policy can be vast and there are different kinds of policies you will need. You should speak to a qualified insurance agent about your business and help them understand what you do so they can give you the right coverage.

 Business Owners Package or "BOP"

A business owners package covers multiple kinds of coverage. If your small business insurance needs and your specific business type qualifies you for a "BOP" you will find this includes multiple kinds of coverage. This can include General Liability, Commercial Property, Commercial Inland Marine or can even include Commercial Auto coverages. The nice thing about these small business insurance packages is they usually include many other coverages at low prices. This article will cover the first two of these coverages.

•  Lets first look at Commercial General Liability. This coverage protects you for losses in which you did something wrong and someone or something was injured/damaged as a result of this action. This does not cover your employees. You should always purchase over $1,000,000 of this coverage per accident. Most BOP's cover this for with a limit of $1,000,000 per accident with a $2,000,000 limit per year. This tends to always be on a BOP and should be purchased as it is one of the primary small business insurance needs. These policies pricing are typically based on sales, payroll, or square footage you occupy.

•  Second, we will look at Commercial Property Insurance. This typically covers your business personal property and if you own the location this covers the building itself. If you do improvements to the building that are nailed down these would be classified as building improvements. Typically, there will be a $500 deductible on these policies.
  
  Building Insurance - The cost of the insurance for the building portion will be priced based on the replacement cost of the building. Most insurance agents have access to a building cost estimator that will look at the square footage of the building and its construction to calculate what it would cost to replace it. This isn't valued the same way as a real estate agent would look at it, as replacement cost could be more than the value of the building on the market, and insurance doesn't look at the value of the land. If you own the building, its extremely important you have coverage on it, make sure this is included in your small business insurance policy.
  
  Business Personal Property is based on replacement cost of the contents of a business. You should keep receipts of your contents as well as a log of what all you have. A small business insurance policy covering "BPP" doesn't include coverage when the property leaves the premises. For this you need an Inland Marine Policy.