small business owner in virginiaEvery business needs business insurance that protects it from liability costs. The coverage needed protects a business against incidents such as slips & falls, as well as third-party property damage. You likely have protection for these and similar risks when you have liability insurance.

There are usually two types of liability insurance available to businesses. One is commercial general liability (CGL), the other is a Business Owner’s Policy (BOP).

What is General Liability Insurance?

This business insurance protects the business from claims made against it by anyone who is not an employee. Some of the things that CGL often covers are:

  • Bodily injury suffered on your company’s premises
  • Property damage for which your company is at fault
  • Advertising/Personal Injury coverage protects your business from claims of slander, libel and copyright infringement.

If you buy CGL insurance it should cover your attorney fees and your court costs. Also covered are judgments and settlements. However, the insurance only covers you up to the limits of the policy. If a judgement against your company is for $1 million, and your liability limit is also $1 million, you will likely have to pay some money out of pocket. This is because your court costs and attorney fees count towards your policy limits.

What is a Business Owner’s Policy (BOP)?

A Business Owner’s Policy is akin to CGL. It essentially takes a few types of liability coverage and bundles them together under one policy. Usually, that BOP has a lower annual premium than CGL. Additionally, a BOP is convenient as you only track one policy rather than several.

This kind of policy often includes:

  • General liability coverage as described above
  • Property insurance that protects your business financially from losses when the property suffers damages or loss by fire, theft and other risks.
  • Business interruption insurance that covers your company for lost income when you must halt business operations due to a covered event.

What Are the Similarities Between CGL and BOP?

Both types of coverage give you basic liability protect and are most often customizable through endorsements. You may be able to add product liability, commercial auto insurance and other specific coverage.

Not all businesses qualify for a Business Owner’s Policy. Qualifications include that your business is a small business. This means your space is not very large and you have a limited number of employees. Also, your business usually cannot be in a high-risk industry.

Businesses that qualify for a BOP should ask their insurance advisor about it as it provides the same coverage as CGL at a lower premium.

Need business insurance. Let Salzberg Insurance Agency help. Call us at 757-583-1828 or 877-757-6081 and we can offer you a fast, free quote on an affordable policy.

Check out our other business information:

Business Insurance for Specialty Construction

3 Key Types of Business Insurance Necessary for a Garage Company

 

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