When choosing a Business Owner's Policy, or BOP, for your business, it is very important to look at the details of the plan. Some policies offer basic coverage. Others offer more protection than the average. Since most business owners want ample protection for their company, it may be beneficial to choose a policy that is all-risk or open-peril. This is not your standard BOP, but a more inclusive plan. Is it right for your business?
What Is All-Risk Coverage?
All-risk insurance applies to the property insurance within your BOP.
Most BOPs have limitations. They cover certain types of losses, and usually no others. However, open-peril or all-risk coverage covers just about anything that is not otherwise excluded from the plan.
Another way to see the difference is to look at what named perils coverage includes. Named-perils is what most standard BOP policies are. They cover the specific items listed on the policy or specific causes of damage. If the policy does not list the coverage, then it probably offers no protection for you.
It is not likely you will see your BOP policy specifically called an all-risk insurance plan. Though this was a common term used for many years, most insurance companies now just use the term open-peril. It will cover numerous perils. But it won't cover every conceivable type of damage.
Should You Consider This Coverage?
Work with your Bruening Insurance agent. Discuss what risks your standard BOP includes. This can change from one company to the next. However, if you notice anything not listed on your policy that could be a risk factor, it might be better to choose an all-peril policy instead. Here is what to consider.
- Compare both insurance policies from your provider.
- Look for exclusions on your standard BOP – most policies will have some exclusions.
- Now, take a look at an all-risk policy. Look for exclusions listed there, too.
- See if there are risks that your standard insurance policy will not cover. Ask your agent about what other businesses like your own file claims for.
- Learn the difference in costs between the two policies. Sometimes, it can be well worth spending a bit more for an all-risk policy.
Open-peril or all-risk BOPs can be a good investment for some companies. Yet, whether it fits your needs depends on the your specific circumstances — including your needs and the type of business you own.