A BOP includes property
protection for an office building and its contents as well as other people's
property brought into the office building. BOPs cover standard perils,
including fire and theft, although certain exclusions apply, such as damage caused
by floods and earthquakes.
Under a BOP, a business
selects the amount of liability coverage it needs based on its assets. Liability
coverage pays for the cost of defending the business in a lawsuit and pays
damages if the business is sued for injury or property damage. The
liability policy also pays the medical expenses of those injured, other than
employees, as a result of business operations.
A BOP provides coverage for both business
interruption and replacement costs if an emergency
disrupts or destroys the business. Business Interruption
insurance not only compensates for lost income and the
expenses incurred when a company is forced to vacate its
premises due to disaster-related damage, but it also
covers operating expenses, such as payroll, which
continue even when business activities have ceased.
Replacement-cost coverage pays to replace damaged or
stolen property, equipment and inventory without
deducting for depreciation.