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June 24, 2014 By admin Leave a Comment

What Does a Businessowners Policy (BOP) Cover?

Insurance_YourPolicyFolderInsurance companies selling business insurance offer policies that combine protection from all major property and liability risks in one package. (They also sell coverages separately.) One package purchased by small and mid-sized businesses is the businessowners policy (BOP). Package policies are created for businesses that generally face the same kind and degree of risk. Larger companies might purchase a commercial package policy or customize their policies to meet the special risks they face.

BOPs include:

  1. Property insurance for buildings and contents owned by the company — there are two different forms, standard and special, which provides more comprehensive coverage.
  2. Business interruption insurance, which covers the loss of income resulting from a fire or other catastrophe that disrupts the operation of the business. It can also include the extra expense of operating out of a temporary location.
  3. Liability protection, which covers your company’s legal responsibility for the harm it may cause to others. This harm is a result of things that you and your employees do or fail to do in your business operations that may cause bodily injury or property damage due to defective products, faulty installations and errors in services provided.

BOPs do NOT cover professional liability, auto insurance, worker’s compensation or health and disability insurance. You’ll need separate insurance policies to cover professional services, vehicles and your employees.

Source: Insurance Information Institute, “What Does a Businessowners Policy (BOP) Cover?” http://www.iii.org website. Accessed June 24, 2014. http://www.iii.org/article/what-does-businessowners-policy-bop-cover

© Copyright 2014. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

Filed Under: Business, Theme 34

May 15, 2014 By admin Leave a Comment

How Can I Disaster-Proof My Business?

Signs_EmergencyExitBusinesses that recover quickly are those that plan in advance. This involves not only purchasing the right insurance, but also developing and maintaining an adequate recovery plan.

MINIMIZE THE RISK OF DAMAGE IN ADVANCE OF AN EMERGENCY BY:

  • Training employees in fire safety, particularly those responsible for storage areas, housekeeping, maintenance and operations where open flames or flammable substances are used.
  • Modernizing the electrical system since faulty wiring causes a large percentage of nonresidential fires.
  • Situating your business in a fire-resistant building – a structure made of non-combustible materials with firewalls that create barriers to the spread of fires – and in a building with a fire alarm system connected to the local fire department. It is also a good idea to have a sprinkler system to douse fires.
  • Limiting storm-related damage by making sure the building conforms to damage-resistant building codes.

DEVELOP A DISASTER RECOVERY PLAN BY:

  • Keeping up-to-date duplicate records of both computerized and written records. Under federal law, if companies fail to maintain and safeguard accurate business records, the company may still be held liable.
  • Identifying the critical business activities and the resources needed to support them in order to maintain customer service while your business is closed for repairs.
  • Planning for the worst possible scenario. Do research before a disaster strikes by finding alternative facilities, equipment and supplies, and locating qualified contractors to repair your facility.
  • Setting up an emergency response plan and training employees how to execute it.
  • Considering the resources you may need to activate during an emergency such as back-up sources of power and communications systems. Also, stockpiling the supplies you may need such as first-aid kits and flashlights.
  • Compiling a list of important phone numbers (including cell phone numbers) and addresses, including local and state emergency management agencies, major clients, contractors, suppliers, realtors, financial institutions, insurance agents and claims representatives. The list should also include employees and company officials. Keep copies off the premises in case the disaster is widespread.
  • Deciding on a communications strategy to prevent loss of your customers. Clients must know how to contact your company at its new location. Among the possibilities to explore, depending on the circumstances, are posting notices outside the original premises; contacting clients by phone, e-mail or regular mail; placing a notice or advertisement in local newspapers; and asking friends and acquaintances in the local business community to help disseminate the information.
  • Review your plan on a regular basis and communicate changes to key employees.

 

Source: Insurance Information Institute, “How can I disaster-proof my business?”
iii.org website. Accessed May 28, 2014. http://www.iii.org/individuals/business/basics/disaster/

© Copyright 2014 intouch Business, Inc. All rights reserved. Certain names and articles used with permission of owners. Trade names mentioned herein are owned by third parties.

Filed Under: Business, Theme 34

May 15, 2014 By admin Leave a Comment

Do I Need Business Interruption Insurance?

Signs_ClosedSignBusiness interruption insurance can be as vital to your survival as a business as fire insurance. Most people would never consider opening a business without buying insurance to cover damage due to fire and windstorms. But too many small businessowners fail to think about how they would manage if a fire or other disaster damaged their business premises so that they were temporarily unusable. Business interruption coverage is not sold separately. It is added to a property insurance policy or included in a package policy.

A business that has to close down completely while the premises are being repaired may lose out to competitors. A quick resumption of business after a disaster is essential.

  1. Business interruption insurance compensates you for lost income if your company has to vacate the premises due to disaster-related damage that is covered under your property insurance policy, such as a fire. Business interruption insurance covers the revenue you would have earned, based on your financial records, had the disaster not occurred. The policy also covers operating expenses, like electricity, that continue even though business activities have come to a temporary halt.
  2. Make sure the policy limits are sufficient to cover your company for more than a few days. After a major disaster, it can take more time than many people anticipate to get the business back on track. There is generally a 48-hour waiting period before business interruption coverage kicks in.
  3. The price of the policy is related to the risk of a fire or other disaster damaging your premises. All other things being equal, the price would probably be higher for a restaurant than a real estate agency, for example, because of the greater risk of fire. Also, a real estate agency can more easily operate out of another location.

Extra Expense Insurance

Extra expense insurance reimburses your company for a reasonable sum of money that it spends, over and above normal operating expenses, to avoid having to shut down during the restoration period. Usually, extra expenses will be paid if they help to decrease business interruption costs. In some instances, extra expense insurance alone may provide sufficient coverage, without the purchase of business interruption insurance.

 

Source: Insurance Information Institute, “Do I need business interruption insurance?”
iii.org website. Accessed May 28, 2014. http://www.iii.org/individuals/business/basics/interruption/

© Copyright 2014 intouch Business, Inc. All rights reserved. Certain names and articles used with permission of owners. Trade names mentioned herein are owned by third parties.

Filed Under: Business, Theme 34

May 15, 2014 By admin Leave a Comment

What Does a Business-Owners Policy (BOP) Cover?

Policy FolderInsurance companies selling business insurance offer policies that combine protection from all major property and liability risks in one package. (They also sell coverages separately.) One package purchased by small and mid-sized businesses is the businessowners policy (BOP). Package policies are created for businesses that generally face the same kind and degree of risk. Larger companies might purchase a commercial package policy or customize their policies to meet the special risks they face.

BOPs include:

  1. Property insurance for buildings and contents owned by the company — there are two different forms, standard and special, which provides more comprehensive coverage.
  2. Business interruption insurance, which covers the loss of income resulting from a fire or other catastrophe that disrupts the operation of the business. It can also include the extra expense of operating out of a temporary location.
  3. Liability protection, which covers your company’s legal responsibility for the harm it may cause to others. This harm is a result of things that you and your employees do or fail to do in your business operations that may cause bodily injury or property damage due to defective products, faulty installations and errors in services provided.

BOPs do NOT cover professional liability, auto insurance, worker’s compensation or health and disability insurance. You’ll need separate insurance policies to cover professional services, vehicles and your employees.

Source: Insurance Information Institute, “What Does a Businessowners Policy (BOP) Cover?”
iii.org website. Accessed May 28, 2014. http://www.iii.org/individuals/business/basics/bop/

© Copyright 2014 intouch Business, Inc. All rights reserved. Certain names and articles used with permission of owners. Trade names mentioned herein are owned by third parties.

Filed Under: Business, Theme 34

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