According to the US Small Business Administration (SBA), there are more than 580,000 small businesses operating in the state of Maryland. Many of these businesses can benefit from the insurance coverage offered by a business owners policy (BOP).
To learn more about how a business owners policy can protect your small or mid-sized business, you can talk to a local independent insurance professional. With more than 200 independent agents in the state of Maryland, it should be easy to find an insurance agent near you.
What Is a Business Owners Policy?
A business owner policy is a policy package that provides small and mid-sized businesses with coverage against many of the common property and liability risks they are likely to face.
Business owners policies are not as comprehensive as traditional business insurance policy packages, and this makes them more affordable and therefore more ideal for small, low-risk businesses.
Are Business Owners Policies Required in Maryland?
Business owners policies are not required by law in Maryland. However, there are times when you might need to have some or all of the coverage these policies offer, such as the following situations.
- If you are renting your business space, your landlord may require you to carry a BOP or other form of business insurance as one of the terms of your lease.
- If your business needs to take out a commercial loan or line of credit, your lender may require you to carry a BOP or other business insurance policy until your loan is paid in full.
Talk to a local independent insurance to learn more.
What are the Business Owners Policy Eligibility Requirements in Maryland?
Small and mid-sized business that have low liability risks make good candidates for business owners policies. If you own a more hazardous businesses like a construction, manufacturing, or transportation company, you will need to buy a traditional business insurance policy package instead.
There are exceptions to every rule, but in general, your business will qualify for a business owners policy if all of the following are true.
- Your business has fewer than 100 employees
- Your business is housed in a small office or workspace
- Your business generates revenues of less than $1 million a year
- Your business operates in a low-risk industry
- Your business does not need more than 12 months worth of business interruption insurance
If your business meets each of these criteria, talk to a local independent insurance agent to start reviewing business owners policy quotes. If not, your agent can explain your other business insurance options.
What Is the Average Cost of a Business Owners Policy in Maryland?
BOPs tend to be much less expensive than traditional business insurance policies because they have fewer coverage options and lower caps on their policy limits. This makes them ideal for small and mid-sized businesses that have few risks.
On average, a business owners policy that provides $1 million in coverage per occurrence with a $2 million aggregate limit for the lifetime of the policy (which is typically one year) is about $100 a month.
To find out how much it will cost to cover your Maryland business with a BOP, you can consult a local independent insurance agent who can provide you with a selection of customized quotes.
What Does a Standard Maryland Business Owners Policy Cover?
Your business owners policy can provide your small to mid-sized company with most of the commercial coverage it is likely to need. You can expect a standard BOP policy to include the following.
- Commercial property insurance: This can cover your business property if it is lost or damaged due to a covered event like theft, fire, or a severe weather event.
- Commercial general liability insurance: This can provide your company with coverage against some of the most common liability risks businesses face, including the following.
- Business interruption insurance: This can provide your business with a continuation of income if damage caused by a covered event forces you to shut down your business operations for an extended time while repairs are made.
Local independent insurance agents can explain each of these coverage types in greater detail.
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What Extra Coverage Can be Added to Your BOP Policy?
Most BOP insurance providers enable business owners to purchase endorsements that will add extra coverage to their policies if needed. For instance, you may be able to add riders for the following.
- Inland marine insurance: This can cover your company’s portable property whenever it is in transit or is being temporarily stored in another location.
- Cyber liability insurance: This can cover against financial losses related to cybercrimes like credit card skimming and data breaches. Since most businesses currently store customer data electronically, this coverage is increasing in importance.
- Employment practices liability insurance: This can cover your business if a current, former, or prospective employee makes an accusation of illegal employment practices such as discrimination or breach of contract.
Talk to a local independent agent to find out whether any additional coverage your business may need is offered as a policy endorsement by your BOP provider. If not, you may need to supplement your coverage with stand-alone policies or consider a traditional business insurance policy package instead.
What Does a Maryland Business Owners Policy Not Cover?
One of the reasons that business owners policies are so affordable is that they do not cover against everything. Because of this, your business may need to buy additional stand-alone policies. If you need a lot of the coverage that isn’t included in a BOP, you may be better off buying a traditional business insurance policy package.
Some of the things a BOP does not cover include the following.
- Professional errors: For this, you will need to purchase professional liability insurance.
- Vehicular accidents: For this, you will need to purchase a commercial vehicle or non-owner vehicle insurance policy that meets or exceeds Maryland’s minimum coverage requirements.
- Worker injuries: For this, you will need to purchase workers’ compensation insurance, which is required for nearly all businesses with one or more employees in Maryland.
- Insurance for employee benefits: If you are interested, a local independent insurance agent can help you review health insurance and life insurance policies that you can subsidize for your employees.
- Flood damage: Flood damage is excluded from nearly all types of insurance policies. If your business is at risk, your insurance agent can buy an affordable commercial flood insurance policy through the National Flood Insurance Program (NFIP).
Talk to an independent insurance agent near you to get more information about additional policies you may need to purchase for your Maryland business.
How to Find the Best BOP Insurance Rates in Maryland
If you are looking for the best and most affordable business owners policy to cover your small or mid-sized business, an independent insurance agent can help. These local agents are not tied to a particular insurance company, so they are free to shop around to find a suitable policy at a competitive rate.
Find an insurance agent near you to learn more about business owners policies to start comparing customized quotes from some of the leading insurance providers in Maryland.