Business Insurance Basics
Every business needs insurance to
protect against potential loss or damage. Commercial general
liability and property coverage are two of the most basic forms of
business insurance.
Business Insurance Basics: Business
Liability Insurance
Commercial General Liability
Commercial General Liability (CGL) policies cover four types of
claims: bodily injury resulting in actual physical damage or loss,
property damage or loss, personal injury (including slander or
libel), and advertising injury. Often, it is offered in a package
with Property coverage at very competitive rates.
Commercial liability insurance is not expensive but the cost to
defend a claim can be catastrophic. One benefit of carrying general
liability insurance is that for covered claims, damages, legal
defense fees and settlement charges are all paid by the insurer up
to the limits of the policy.
Your Techinsurance agent can provide you with recommended coverages
and limits for your business liability insurance. He or she can also
discuss with you optional coverages, or endorsements, you might wish
to purchase for added protection against certain risks. If
necessary, an Umbrella Liability policy can be purchased separately
to extend coverage well above the limits of your standard commercial
general liability policy.
Business Insurance Basics: Property
Coverage
Property insurance protects your business property against
physical loss or damage by theft, fire or other means. Because every
business has property that could become lost or damaged, this form
of business insurance is one of the first things you should buy when
you start a company.
Property coverage can be structured several ways. In the most basic
business insurance policies, Property coverage protects your
furniture, computers, office equipment and other materials.
For many businesses, the most basic Property coverage is not enough.
You may need a policy that insures data, papers, records, money and
securities kept at your place of business. Sometimes this coverage
is included in a basic Property policy (it may be listed as Valuable
Papers or Media and Extra Expense coverage); if not, it can usually
be purchased as an extra endorsement to your standard policy.
Business Insurance Basics: Package
Policies (BOP)
Package Policies Combine General Liability and Property
Insurance
When you evaluate business insurance, consider a package policy
such as a Business Owner’s Policy (BOP). A BOP combines Property
coverage and General Liability insurance in a single business
insurance policy.
You may find that by combining Property and General Liability
insurance into a BOP, you can get better business coverage at lower
rates than you would get from two separate policies.
Advantages and Exclusions to Business Owners Policy (BOP)
Not every business is eligible for BOP coverage. Business Owners
Policy packages are especially designed for small- to medium-sized
business operating in a low-risk business class. The BOP includes
Commercial General Liability insurance and Property insurance for
physical assets, such as office furniture and computers. The package
policy may also cover loss of business income and extra expense.
A BOP generally insures lost or damaged property for replacement
value, which means you'll receive enough from your settlement to
replace the property at today’s market value. The Property portion
of a BOP also covers other people’s personal property to the extent
it would be covered under a standard Property policy.
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