Business Insurance Dallas TX: Find the Coverage Gaps

Business Insurance Dallas TX

Insurers often combine a number of insurance coverages into one package that is sold as a single contract. The most common policy for small businesses is the Enterprise Policy (BOP).

The BOP combines coverage of all major property and liability insurance risks, as well as many additional coverages, into a single policy package suitable for most small businesses. The term “BOP” refers specifically to insurance policy language developed (and revised as necessary) by ISO experts. ISO provides examples of insurance policy language, research and a variety of other products to insurance companies.

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BOP includes commercial income insurance, sometimes called business interruption insurance. This compensates a business owner for loss of income after a disaster. Disasters often disrupt operations and can force a business to leave its premises. The company’s income insurance also covers additional expenses that may be incurred if the company must operate out of a temporary location.

To cover specific risks associated with a business, a variety of additional coverages can be added to the basic BOP. For example, if a business has an outdoor sign, the BOP does not cover it unless the coverage is specifically added for an additional premium. If a business relies on e-commerce, the owner may add coverage for loss of revenue and extra expenses in the event that the business’ ability to conduct e-commerce slows down or stops due to a computer virus or hacker.

Only small and medium enterprises that meet certain criteria are eligible for a BOP. Factors that insurers consider include the size of the facility, the required liability limits, the type of business, and the extent of off-site activity. BOP premiums are based on those factors plus business location, financial stability, building construction, security features and fire risks.

Main Coverages

Most small businesses need to buy at least the following four types of insurance:

• PROPERTY INSURANCE – Property insurance compensates a business if the property used in the business is lost or damaged as a result of several types of common hazards, such as fire or theft. Property insurance covers not only a building or structure, but also what insurers call personal property, i.e., office furniture, inventory, raw materials, machinery, computers and other items vital to the operations of a business. Depending on the type of policy, property insurance may include coverage for equipment breakdown, debris removal after a fire or other destructive event, some types of water damage and other losses. It can also provide operating funds during a period when the business is trying to return to normal after a catastrophic loss.
• LIABILITY INSURANCE – Any company can be sued. Customers may claim that the business caused them damage as a result, for example, of a defective product, an error in a service, or indifference to someone else’s property. Or a claimant may claim that the business created a dangerous environment. Liability insurance pays damages for which the business is responsible, up to the limits of the policy, as well as attorneys’ fees and other legal defense expenses. It also pays the medical bills of any person injured by or on the premises of the business.
• AUTO BUSINESS INSURANCE – A business auto policy provides coverage for cars owned by a business. The insurance pays any third party costs resulting from bodily injury or property damage for which the business is legally responsible, up to the limits of the policy.
• WORKER’S COMPENSATION INSURANCE – In all states except Texas, an employer must have workers’ compensation insurance when there are more than a certain number of employees, ranging from three to five, depending on the state. Workers’ compensation insurance, as this coverage is generally called, pays for medical care and replaces a portion of lost wages for an employee who is injured in the course of employment, regardless of who was at fault for the injury. When a worker dies as a result of injuries sustained while working, the insurance provides compensation to the employee’s family. An extremely small business, such as one operated by one or two people outside the home, may not need workers’ compensation insurance. But it often needs more property and liability insurance than is provided in a typical homeowner’s policy.

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