Depending on the coverage you choose, a small business insurance policy helps protect your business from things like financial losses, property damage, and more. Covered incidents may include theft, fire, wind, falling objects, and lightning, among others. It's important to read your policy documents carefully to understand which coverages are included and what perils are covered by your insurer.

Similar to other types of insurance, each coverage in your BOP has its own coverage limit. This is the maximum amount your insurer will pay for a covered claim. Some coverages may also require a deductible. The deductible is the amount you pay out of pocket before your insurance kicks in to pay for a covered claim.

Business property coverage

The property coverage in a small business insurance policy helps ensure that your business's property is well protected. For example, if there’s a fire at your business, a BOP may help pay for building repairs (if you own the building), as well as replacement costs for things like furniture, computers, and machinery.

Keep in mind that business property coverage will be subject to a deductible and limits. You can typically choose your limits based on the estimated cost to repair, rebuild, or replace your business's property. But, if your losses exceed the coverage limit you chose, you'll need to pay the remaining costs out of pocket to get your business up and running again.

It's also important to note that having insufficient policy limits could result in a penalty, depending on local regulations. To avoid fines, work with your agent to make sure you purchase enough insurance to cover your business and its contents.

General liability coverage

A BOP usually includes general liability coverage (sometimes called commercial general liability, or CGL). If a visitor is injured at your business, or one of your employees damages someone else’s property and you're found liable, general liability coverage may help pay for the injured party's medical expenses or property repairs. It may also help pay for legal costs if you're taken to court over an accident that occurred at your business.

Commercial general liability insurance is also subject to a coverage limit. That means if an injured person's medical bills exceed your coverage limit, you may have to cover the rest on your own.

Business interruption coverage

Business interruption coverage, sometimes called business income coverage, is also typically part of a business owner’s policy. This coverage helps replace lost income and extra expenses if your business is affected by a covered peril.

For example, say a tornado or fire makes your office unusable. Business interruption coverage may help pay for rental costs at a temporary office while repairs are made. Business interruption coverage may also help replace lost business income due to a covered incident.

Similar to other coverages in a BOP, your coverage will have a limit. You may also be subject to a restoration period. This means that your coverage may come to an end if your business hasn’t returned to normal operations within a specified time period. Be sure to ask your insurer about specific limits.

Commercial auto insurance

As a small business owner, if you or your employees drive vehicles for business purposes you may need commercial auto insurance to help protect your commercial vehicles, the tools, equipment, and other cargo it carries, as well as the people who drive those vehicles and serve your business every day. Commercial auto insurance helps protect against liability and physical damage that may occur when using vehicles for your business. This includes pickup trucks, vans, cars, and small commercial vehicles.

Commercial auto insurance is important because vehicles for business purposes faces a different kind of risk and personal auto insurance policies typically exclude many commercial uses. Make sure to inform your insurance agent if you or your employees ever use vehicles, including their own, for things like meeting with clients, making deliveries, transporting equipment, or traveling between job sites. And if you are transporting items, just like your vehicles, when those items are on the move, your coverage should follow. Your provider can make sure you have the proper protection when you are on the road, on the job and everywhere in between.

Additional business insurance coverages

If you’re looking for additional protection for your business, you may qualify for a few additional coverages. Some coverages to consider adding to your BOP include:

Talk to your insurer about your specific small business insurance needs. They can help you customize your policy with coverages that work for your situation.