A Businessowners Policy, commonly referred to as a BOP, is a packaged commercial insurance policy that combines commercial property and general liability coverage into a single policy form. BOPs are designed for smaller businesses that meet carrier eligibility criteria and offer a more cost-effective alternative to purchasing property and liability coverages separately under a commercial package policy.
Muller Insurance evaluates every small business we work with to determine whether a BOP is the appropriate policy structure or whether a commercial package policy is more suitable for the operation. The distinction matters because BOPs have eligibility limitations, and placing an ineligible business into a BOP can create coverage gaps.
What a BOP Covers
Commercial Property Coverage
Covers the business property at the insured location, including the building (if owned), business personal property, inventory, equipment, furniture, and fixtures. Coverage applies to loss from fire, theft, vandalism, windstorm, and other covered perils listed in the policy.
General Liability Coverage
Covers bodily injury and property damage claims brought against the business by third parties. This includes customer injuries on the premises, damage to client property, and personal and advertising injury claims such as libel or copyright infringement.
Business Income Coverage
Most BOP forms include business income coverage, which replaces revenue lost when a covered loss forces the business to suspend operations temporarily. The indemnity period, which is the length of time the policy pays, is typically twelve months under a standard BOP form.
What a BOP Does Not Cover
BOPs have standard exclusions that business owners should understand. The following coverages are not included in a standard BOP and must be added separately if needed:
- Workers compensation: required by NJ law for businesses with employees, not included in a BOP.
- Commercial auto: vehicles used for business are not covered under a BOP.
- Professional liability: errors and omissions coverage is not part of a standard BOP.
- Flood: flood damage is excluded from standard commercial property policies including BOPs.
- Liquor liability: for businesses that serve alcohol, liquor liability must be added separately.
BOP Eligibility for NJ Businesses
Not every business qualifies for a BOP. Carriers use eligibility criteria based on business type, annual revenue, square footage, and other factors. Businesses that generally qualify for BOPs include:
- Small retail stores with revenues within carrier guidelines
- Restaurants, cafes, and food service operations below a revenue threshold
- Small professional offices
- Service businesses operating from a fixed location
Businesses that do not qualify for a BOP, including those with higher revenues, larger footprints, or higher-risk operations, are placed into commercial package policies that allow more customization of coverage components.
BOP vs. Commercial Package Policy
A commercial package policy (CPP) offers more flexibility than a BOP. Under a CPP, each coverage component is individually structured and priced, which allows for higher limits, broader coverage terms, and additional coverage types. For businesses that have grown beyond BOP eligibility or that have complex operations, a CPP is generally the appropriate structure. Muller Insurance evaluates each business individually to determine which policy structure fits the operation.
Our BOP Carriers for NJ Businesses
- Amtrust: writes BOPs for qualifying NJ businesses including retail, food service, and service operations.
- Cumberland Mutual: writes BOPs for qualifying small businesses in NJ.
- Franklin Mutual (FMI): writes BOPs and commercial package policies for qualifying NJ businesses.
- Andover Companies: writes commercial package policies for NJ, NY, and CT businesses.
Contact Muller Insurance
For a BOP or commercial package policy quote for your NJ business, call Muller Insurance at 201-659-2403 or visit MullerInsurance.com. We write commercial coverage for small and mid-size businesses across Hoboken, Jersey City, and New Jersey.
