If you own a business—whether it’s a small retail shop, a contractor operation, or a service-based company—you’ve probably heard of
General Liability Insurance and a
Businessowners Policy (BOP). They sound similar, but they offer very different levels of protection.
In this guide, we outline what each policy covers, how they differ, the types of businesses they are best suited for, and how to choose the right one for your situation.
What Is General Liability Insurance?
General Liability Insurance is the foundation of most business insurance programs. It protects your business from claims involving:
- Third-party bodily injury (someone gets hurt because of your business)
- Third-party property damage (you damage someone else’s property)
- Personal and advertising injury (libel, slander, copyright issues)
- Legal defense costs, even if a lawsuit is groundless
For many businesses, General Liability is the minimum required coverage—and often the first policy a client or landlord will ask for.
What Is a Businessowners Policy (BOP)?
A Businessowners Policy bundles multiple coverages into one package. A BOP typically includes:
- General Liability Insurance
- Commercial Property Insurance (your building, contents, equipment)
- Business Interruption / Business Income coverage
A BOP can also be expanded to include additional protections such as:
- Cyber liability
- Equipment breakdown
- Employment practices liability insurance (EPLI)
- Outdoor signs and business personal property
- Optional endorsements depending on your industry
Because these coverages are bundled, a BOP is often more cost-effective than buying each policy individually.
Key Differences Between General Liability and a BOP
1. A BOP includes property coverage—General Liability does not
If you have a physical location, inventory, or equipment, a BOP offers broader protection.
2. A BOP covers lost income after a covered claim
Business interruption coverage is one of the biggest advantages of a BOP. General Liability alone won’t cover lost revenue if you need to close after a fire or major property damage.
3. A BOP offers more customization
You can add coverages like cyber, equipment breakdown, or EPLI to a BOP. General Liability is more limited.
4. Not all businesses qualify for a BOP
A BOP is typically designed for:
- Small to mid-sized businesses
- Lower-risk industries
- Companies with a physical location and business property
Contractors, high-risk industries, and very large businesses often don’t qualify.
Who Should Choose General Liability Only?
General Liability may be the better fit if:
- You’re a freelancer, consultant, or service professional
- You work from home with no business property exposure
- You do not have a storefront, office, equipment shop, or inventory
- You primarily need basic liability protection for contracts or leases
This is common for certain contractors, service providers, marketing agencies, consultants, etc.
Who Should Choose a BOP?
A BOP is often the better choice if your business:
- Has a physical office, storefront, shop, or warehouse
- Stores inventory, equipment, tools, or supplies
- Would lose money if a fire or major claim shut down operations
- Needs multiple coverages bundled into one cost-effective policy
Retail stores, restaurants, wholesalers, small manufacturers, landscapers (with storefronts), and many professional offices typically qualify.
What a BOP Does NOT Cover
Even though a BOP includes broad coverage, it does not replace all insurance needs. You may still need:
- Commercial auto insurance
- Workers’ compensation
- Professional liability (E&O)
- Cyber liability (unless added)
- Liquor liability (if applicable)
- Employment practices liability (unless added)
This is why working with an agent who understands your industry—and your risks—is essential.
Which One Is Right for Your Business?
Choosing between General Liability and a BOP comes down to your business’s size, risk profile, and property exposure.
You likely need General Liability if:
You’re a service-based business with no physical location or business property.
You likely need a BOP if:
You have a storefront, office, equipment, or inventory—and you want broader, bundled protection at a better price.
If your business grows or your risk changes, you can always upgrade from General Liability to a BOP later.
Need Help Deciding Between General Liability and a BOP?
If you're unsure which policy is the right fit for your business, I can walk you through your options and build a program that protects you properly without overpaying.
Contact me today for a free coverage review and personalized recommendations.
