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BOP

Business Owner's Policy (BOP) for Washington Small Businesses

The smart way to insure your business. A BOP bundles general liability and commercial property insurance into one convenient, cost-effective package with built-in business interruption coverage.

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Coverage Details

What's Included

What BOP Covers

  • General liability coverage (bodily injury, property damage to others)
  • Commercial property (building, equipment, inventory, furniture)
  • Business interruption (lost income during covered closures)
  • Equipment breakdown coverage
  • Data breach response (basic cyber coverage)
  • Business personal property at other locations
  • Loss of business income due to covered events

What It Doesn't Cover

  • Professional errors (need professional liability/E&O)
  • Auto accidents (need commercial auto insurance)
  • Employee injuries (need workers' compensation)
  • Flood damage (need separate flood insurance)
  • Earthquake damage (need earthquake endorsement—important in WA)
  • Large-scale cyber attacks (need comprehensive cyber liability)
  • Employee dishonesty over basic limits (need crime coverage)
Process

How BOP Works

1

A BOP combines general liability and commercial property coverage into a single policy, typically at a 10-15% discount compared to purchasing these coverages separately.

2

When you experience a covered loss—whether it's a customer injury (liability) or a fire that damages your equipment (property)—you file a single claim with one insurer who handles everything.

3

Business interruption coverage, included in most BOPs, kicks in when a covered event forces you to close temporarily. It pays your ongoing expenses and lost profits while you recover.

4

You can customize your BOP with endorsements for additional coverage like hired auto, equipment breakdown, or enhanced cyber protection. This flexibility makes it adaptable to your specific needs.

5

At renewal, your BOP adjusts based on any claims, changes in your business (revenue, property values), and market conditions. Regular reviews ensure your coverage keeps pace with your business growth.

Industries

Who Needs BOP?

Retail stores and shops
Restaurants and cafes
Office-based professional businesses
Service businesses with equipment
Small manufacturers and fabricators
Salons and personal care businesses
Any business with a physical location and property
Compliance

Washington State Requirements

Washington State does not require businesses to carry property insurance or BOPs, but practical business necessities make coverage essential for most operations.

Commercial landlords throughout Washington require tenants to carry both liability coverage and property insurance for tenant improvements and business personal property. A BOP satisfies both requirements.

Lenders and banks require property insurance (often through a BOP) when you finance equipment, take out business loans secured by assets, or have an SBA loan.

Washington's earthquake risk makes supplemental earthquake coverage important. Standard BOPs exclude earthquake damage, but endorsements are available and recommended for Western Washington businesses.

If you operate from home, your homeowner's policy likely excludes business use. A BOP or in-home business policy provides proper coverage for business equipment and liability.

Pricing

What Affects Your BOP Cost?

Property values—the total value of your building space, equipment, and inventory determines how much coverage you need

Business location—property values and replacement costs vary across Washington, which affects your coverage needs

Industry type—different businesses have different risk profiles for both liability and property exposure

Building construction—factors like fire-resistant materials and building age influence property coverage

Security features—protective measures like alarms, sprinklers, and security systems can positively impact your rate

Claims history—a clean track record demonstrates lower risk for insurers

Deductible selection—the amount you choose to pay out-of-pocket before coverage applies affects your rate

Real-World Examples

Claims Scenarios

See how bop protects Washington businesses in actual claim scenarios.

Fire Damage with Business Interruption

Scenario:

A kitchen fire at a Tacoma restaurant causes $75,000 in property damage and forces a 6-week closure for repairs. The owner faces ongoing rent, utilities, and payroll while earning no revenue.

Outcome:

The BOP's property coverage pays for repairs and equipment replacement. Business interruption coverage pays approximately $40,000 in lost income and ongoing expenses during the closure, keeping the business solvent.

Customer Injury at Retail Store

Scenario:

A customer at a Seattle boutique trips over a display and suffers a broken hip, requiring surgery. Medical bills total $45,000, and they sue for an additional $100,000 in damages.

Outcome:

The general liability portion of the BOP covers medical expenses, legal defense, and settlement. The store owner pays only their deductible while the insurer handles the six-figure claim.

Equipment Theft

Scenario:

Thieves break into a Bellevue photography studio overnight, stealing $30,000 worth of cameras, lenses, and computers. The photographer can't work until equipment is replaced.

Outcome:

The property coverage in the BOP covers the stolen equipment at replacement cost. Business interruption coverage compensates for lost bookings during the two weeks needed to replace and set up new equipment.

FAQ

Frequently Asked Questions

What are the advantages of a BOP over separate policies?
A BOP simplifies your insurance by bundling coverage into one policy with one renewal date, one bill, and one point of contact. If you have a claim, you work with a single adjuster rather than coordinating between multiple companies. Bundling also typically provides better value than purchasing general liability and commercial property insurance separately from different insurers.
What size business qualifies for a BOP?
BOPs are designed for small to medium businesses. Typical qualification requirements include annual revenue under $5 million, fewer than 100 employees, premises under 25,000 square feet, and operating in an eligible business class. Larger businesses or those with complex risks may need a Commercial Package Policy (CPP) instead, which offers more customization for unique business needs.
Does a BOP include workers' compensation?
No, workers' compensation is always a separate policy and cannot be bundled into a BOP. In Washington specifically, workers' comp is managed through L&I (Department of Labor & Industries) rather than private insurance, so it's completely separate from your BOP. You'll need to register with L&I and pay quarterly premiums based on your payroll and risk classification.
What's business interruption coverage and how does it work?
Business interruption coverage pays your ongoing expenses and lost profits when a covered event (like a fire or storm) forces you to close temporarily. It covers rent, utilities, loan payments, payroll for key employees, and the net income you would have earned. Coverage typically lasts until you reopen or for a maximum period (often 12 months). This coverage can mean the difference between surviving a disaster and going out of business.
Can I customize what's included in my BOP?
Yes, BOPs can be customized with endorsements for additional coverage. Common additions include hired and non-owned auto (for employees using personal vehicles), equipment breakdown, enhanced cyber liability, outdoor signs, valuable papers coverage, and spoilage coverage for perishable goods. We can help you build the right package for your specific business needs and risks.
Does a BOP cover earthquakes in Washington?
No, standard BOPs exclude earthquake damage. Given Washington's seismic activity, especially in the Puget Sound region, earthquake coverage is an important consideration. You can add earthquake coverage through an endorsement to your BOP. The cost varies based on your location, building type, and construction. Businesses in Seattle, Tacoma, and Western Washington should seriously consider this coverage.
Related Coverage

You May Also Need

GLGeneral LiabilityCYBERCyberCACommercial Auto

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