Business Property Insurance for Commercial Offices
You envision taking your commercial facility to a new level of profitability in 2025, and you can hardly wait to see your growth unfold. You're in good company.
Research shows the U.S. has over 31 million entrepreneurs and a total of 5.5 million brand-new companies emerged in recent years.
One part of owning a commercial business is ensuring it's insured. How can you tell you have adequate office insurance? Let's explore what to look for in business property insurance for commercial offices.
Business Owners Policy
A Business Owners Policy, or BOP, can be an excellent insurance option for business owners with commercial facilities. This office insurance policy combines several commercial insurance coverage options for protecting your business against multiple risks.
A BOP may be a convenient one-stop solution for key insurance coverages for your office. It can save time compared to buying separate policies for insurance coverage. This makes it a convenient option for business insurance.
Components of BOP
A vital component of a BOP is general liability insurance. This kind of insurance helps to protect companies against third-party claims of physical injuries and related medical costs. It can also protect against third-party injury claims filed against your business, including associated legal costs.
Another type of insurance included in a BOP is property insurance. Property insurance protects your commercial business from losses due to breakdowns, theft, vandalism, and fires. You can use this insurance to help replace property or lost income resulting from covered losses.
Cyber Coverage
Another kind of insurance included in a BOP is a cyber risk policy. Cyber risk coverage can help protect your company if you experience data breaches or your data is destroyed or corrupted due to a cyber attack. These events may happen as a result of the following:
- Cyber meddlers or hackers
- Network-level security attack
- Cyber extortion
- Virus
Cyber extortion happens when a hacker threatens to hurt or expose a business's reputation, systems, or data unless the company complies with the hacker's demands or pays a ransom. This crime can cause major reputational and financial damage to organizations and individuals.
Network security attacks occur when individuals try to exploit vulnerabilities in networks or their systems. These systems may include servers and firewalls. They might also include the following:
- Printers
- Switchers
- Routers
- Computers
The aims of network attacks include stealing, modifying, or removing access to valuable data permanently or temporarily. A network attack might be passive or active.
Passive attacks can include idle scans or wiretapping, while active ones may include denial of service, or DoS, attacks. A DoS attack happens when someone prevents another person from accessing their own systems by interrupting these systems' functioning.
Cyber coverage can help cover costs related to investigating these attacks as well as expenses related to notifying impacted parties if their information is stolen.
Additional Coverage Options
Other types of coverage available through a BOP include debris removal and equipment breakdown insurance. Debris removal offers reimbursement for cleanup expenses associated with property damage. The policy can cover debris from insured perils like fires, but not hazardous materials or pollutants.
Equipment breakdown coverage is also known as machinery insurance, mechanical breakdown, or boiler insurance. It helps cover equipment replacement or repair costs if your equipment is suddenly damaged or stops working unexpectedly.
Exclusions
A BOP can protect your commercial business against multiple liabilities, but some exclusions exist. You may need extra coverage to go along with your BOP, like Workers' Compensation insurance.
Workers' Comp can help protect your company from financial and legal expenses tied to employee illnesses and injuries that happen while your employees are working.
Are You a Candidate for a BOP?
Getting a BOP can be helpful in several scenarios. Let's examine whether you should consider getting a BOP:
Business Assets
Suppose your company owns equipment or tools that you rely on regularly. A BOP might cover your equipment, fixtures, and future if damaged or stolen. The cost of replacing or repairing these items might be incorporated into your policy.
Potential For Lawsuit
Suppose a customer chooses to sue your business. A BOP can protect your company from a lawsuit that a third party files against you due to allegedly experiencing customer injuries or property damage due to business equipment or employees. Business insurance helps avoid out-of-pocket costs.
Customer Data
Does your business store private client data? A BOP may be a wise decision. Your BOP will include cyber insurance as mentioned earlier, which can cover the costs required to hire experts to determine a cyber-attack's or data breach's cause.
Is Business Property Insurance Required?
Local and state governments usually don't require BOPs. Governments may still require general liability insurance depending on your type of company or your business location. Some states may also require proof that a person has general liability coverage before issuing them a contractor's business license.
Obtaining a BOP may be a good idea even if your local law doesn't require coverage. That's because client contracts might require coverage in case things go awry.
Let's say you work on other people's properties. Your customer might insist your company has insurance before working on their properties. You might also be required to display insurance paperwork to get a new lease or mortgage for your company.
Need Office Insurance?
Business property insurance can help protect your business when unanticipated events, such as theft or fires, happen. Office insurance may also help protect your company against data breaches and customer lawsuits.
At PolicySweet®, we offer a BOP to help protect business owners from incidents they may face while running their commercial offices. We also provide HomeHQSM insurance policies for individuals who run home-based businesses. Contact us to learn more about our coverage, and request a quote today!