Embroker Team September 6, 2022 7 min read

How Much Does a Business Owners Policy (BOP) Cost?

Man presenting clipboard detailing average bop insurance rates

A Business Owners Policy (BOP) is one of the most standard business insurance policies that you can buy to protect your business but what are the average BOP insurance rates.

The policy enables small business owners to put together a basic insurance program for their companies quickly and cost-effectively by bundling several standard coverages into one convenient package; a package that will cost less than having to buy the aforementioned standard coverages separately.

Since one of the most significant pros that come with purchasing a BOP is the fact that it can save you money, one of the most common questions business owners ask insurers when discussing coverage options is, “What are the average BOP insurance rates?”

Let’s take a look at the factors that go into determining the price of a BOP to help business owners to get a rough idea of what they can expect to pay for this coverage.

What Does a BOP Cover?

The most typical bundle that a BOP includes is general liability, commercial property, and business interruption insurance. A commercial general liability policy helps your business pay costs associated with third-party bodily injuries or property damage. It will also cover claims related to advertising injuries such as copyright infringement and defamation.

When we say “cover associated costs,” this means defense costs if your business is sued, settlement costs if you lose the claim, and even medical and repair bills if you are found responsible for third-party bodily injury or property damage.

A typical claim that general liability would cover is a slip and fall accident in which a customer is injured on your business property.

A commercial property insurance policy pays for damages to your physical assets, including not only the building(s) in which you work, but also your equipment, furniture, inventory, and anything other business-related property.

If your restaurant burns down as the result of a grease fire, for example, your property insurance would help cover the costs of restoring or replacing all of your property that was damaged or lost in the fire.

While your property insurance covers the physical losses in the event of a fire, business interruption insurance would cover the resulting financial losses. If your business is forced to close its doors for an extended period of time, a business interruption insurance policy will cover lost income, expenses, loans, and staff wages so that you can keep your business afloat while working towards reopening.

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BOP Endorsements and Additional Coverages

Of course, the package of general liability, property, and business interruption insurance is the most basic type of BOP that a business can put together. If necessary, businesses can build out their BOPs into far more robust policies if the need for doing so exists.


Businesses can add endorsements (or riders) in order to customize their BOP, and obviously, every endorsement added to the policy will increase the price of your BOP.

Here are some of the most common endorsements that insurers tend to offer as a rider to a Business Owners Policy:

  • Extra Expenses: Covers expenses for relocating and continuing to work while your main property is being repaired or restored. It will cover renting property and equipment, overtime pay, and more.
  • Inland Marine: Covers your business’s property that might suffer damages or cause damages to a third party while in transit.
  • Equipment Breakdown: Covers the cost to repair or replace damaged or broken equipment.
  • Spoilage: Covers the cost of replacing perishable inventory that has gone bad due to a malfunction or issue with utilities.
  • Employee Theft: Covers financial losses related to employee theft and other crimes.

How Much Does a BOP Cost?

While it’s hard to give an exact number, since there are so many factors that go into average BOP insurance rates, typically, most businesses can expect to pay between $500-$2,000 per year for a BOP.

If you’re purchasing general liability and property insurance policies independently instead of a BOP, you’ll probably end up paying close to 10% more than you would pay for a BOP, which is why BOP insurance is such a popular option for small businesses.

What Influences BOP Cost?

Now let’s talk about some of the main factors that are going to influence the average BOP insurance rates.


There are a large number of insurers to choose from and most of them have their own BOP insurance offers, but average BOP insurance rates can vary quite a bit from insurer to insurer. Embroker’s BOP product is particularly affordable and offers excellent coverage that meets the needs of a majority of small businesses. We’re able to provide top-tier coverage for a lower price because our policy is completely digital. By automating everything, we save on overhead and pass those savings on to you. Learn more and get an instant business owners policy quote with Embroker in just a few minutes.


If your business is operating in a high-risk industry, you can expect the average BOP insurance rates to be more expensive. For example, construction companies can expect to pay significantly more than a software development company, because their jobs involve a significantly greater amount of risk, especially in terms of third-party injury and property damage.

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Size and Location

The more employees you have, the more the higher the average BOP insurance rates. Your location is also a huge factor that’s taken into consideration when putting together a commercial property policy. Businesses located in urban areas will pay significantly more than those located in rural areas. If natural disasters such as floods, hurricanes, wildfire, or earthquakes threaten your area regularly, your BOP will, naturally, be more expensive.

Property Value

Another factor that is often tied to location, property value is very important in the process of determining your average BOP insurance rates. This takes into consideration not only your physical locations, but also equipment, inventory, signage, and any other property directly related to your business. Your property value directly impacts your coverage limits. If your building costs a million dollars to replace, your premium is going to be much higher than if your property was only worth $400,000. Also, the higher your liability limit is, the more you’ll pay in premiums.

Claims History

Another factor that is fairly clear cut. If you’ve experienced many claims over recent years, your insurer is going to look at you as a high-risk business. If your company has an excellent risk management program and hardly ever experiences claims, your average BOP insurance rates will be lower.

Replacement Cost vs. Actual Cash Value

When you are putting together commercial property coverage, you are going to need to choose between a replacement cost and actual cash value policy. Replacement cost is the better coverage option because it will pay the full value of the property with no depreciation. But it’s also the more expensive option. If you choose an actual value policy, your insurer pays the value of the equipment at that time, but the policy will be less expensive.


The deductible is the amount of money you pay at the time of a loss. Naturally, the higher the deductible, the lower your BOP insurance premium. The insurer reduces your premium because you have agreed to cover a greater percentage of the loss. This is a good strategy if you have a good claims history and you work in a fairly low-risk industry. If the opposite is true, you’ll end up paying a lot more to cover a claim, despite the fact that you might be saving a bit of money on your monthly or annual premium.

How to Decrease the Average BOP Insurance Rates

As we just mentioned, paying a higher deductible is a way to decrease your premium, but it’s not really the best or smartest option. Here are some true best practices when it comes to paying less for your BOP insurance.

Invest in Risk Management

Regardless of industry or any other business characteristics, the best way to keep your insurance premiums low is to establish a proper risk management program company-wide. This means taking precautions and steps to prevent claims and losses from occurring. Educate your employees so that they don’t make mistakes that can lead to claims. Invest in safety measures and regular maintenance to keep your property in good condition. Insurers will reward companies that take serious steps and precautions to protect their commercial property with discounts on their BOP insurance.

Pay the Entire Annual Premium at Once

If you are able to pay the entire annual premium for your BOP insurance at once, do it. You can save a significant amount of money by doing so instead of choosing to pay your premium on a monthly basis.

Buy Only What You Need

As we’ve mentioned, there are numerous endorsements that you can attach to your BOP if you need additional cover. But the key word here is “need.” Make sure that you only buy coverage your business truly needs. Only buy insurance policies that make sense for your business.

Work with an Expert Broker

How will you know which policies you need and which are superfluous? By making sure that you have an expert broker by your side. When putting together an insurance program, it’s important to have a broker in your corner that not only understands business insurance but, most importantly, understands the specific insurance needs of your industry and your business in particular.

If you’re looking to learn more about BOP insurance and would like to discuss your coverage options, you can reach out to one of our expert brokers at any time.

For more details on insurance costs and premiums, head over to our main guide on business insurance cost.

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