When you purchase a business owners policy, your main goal is typically to protect your business against claims, losses and lawsuits. But in some cases you may want specific employees or individuals covered under your BOP, in which case you can tailor your policy to cover who you need and when.
Coverage Under a Basic BOP
As a reminder, a basic business owners policy includes two coverages:
- General Liability Insurance: General liability insurance covers claims against your business concerning bodily injury, property damage and personal or advertising injury.
- Commercial Property Insurance: Commercial property insurance covers your business’ physical property from damages caused by fire, wind, hail, lightning, smoke, theft, vandalism and more.
General liability insurance covers third parties that are injured or their property is damaged on your business’ property. If a customer is injured in your store, for example, general liability insurance can cover the victim’s medical bills while also protecting your business from a related lawsuit. Anyone considered a third party may be covered under your business’ general liability insurance. Those covered under personal and advertising injury could also include competitors, as this coverage includes coverage for libel, slander, theft of an advertising idea, copyright infringement and more.
Are Employees Covered Under a Business Owners Policy?
If an employee is injured on the job, they will not generally be covered under general liability insurance. Instead, they should be covered under a workers compensation policy, which covers employees who are injured at work.
You can add coverage for employees in other circumstances, however. For example, if you have employees driving your work vehicles, they should be covered under your business’ commercial auto insurance policy.
Other coverages you can add to a BOP that may cover employees include:
- Professional Liability: Professional liability insurance covers claims against your business and employees concerning professional negligence. Not only can this business compensate clients who lose money due to professional negligence, but it can also protect your business’ professionals in case of a related lawsuit.
- Crime Insurance: Crime insurance serves to protect your business in case of employee dishonesty. If one of your employees steals from the business, commits fraud, embezzles, etc., crime insurance can compensate the business for its losses.
- Directors and Officers Insurance: Directors and officers insurance covers the key employees of your business while they are working for you. This covers lawsuits regarding their actions on the board of the business concerning misrepresentation, mismanagement and more. These policies also often come with Employment Practices Liability (EPLI), which covers your directors and officers from claims such as discrimination, sexual harassment, wrongful firing or hiring, etc.
Also Read: Who Qualifies for a Business Owners Policy?
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