If you’re an entrepreneur or small business owner in Nashville, what you need, insurance-wise, is as unique as your business itself. So if you’re shopping for small business insurance, I wouldn’t make an across-the-board recommendation, since at least half the time, I’d probably be recommending too little, too much or not specific enough coverage.
That said, if we’re just talking averages, most of you will probably end up with what’s called a business owners policy, or BOP. So if you’re just starting to explore insurance to protect your company or project, that’s, to me, the best place to start reading.
What a business owners policy covers
I’ve heard some insurers compare a BOP to something like home insurance coverage for your business, and that’s decent shorthand. What these policies will typically offer you as a business owner:
— property insurance that covers any buildings your company owns/works out of, along with the contents of those buildings (which can be anything from your products to the tools you use to do business)
— liability protection, focused on potential legal issues that could arise from mishaps by you, your employees or your products (this could be anything from an employee who improperly installs something for a customer, to one of your products malfunctioning and causing bodily injury or property damage)
— business interruption insurance, which could mean the difference between staying afloat and folding if something goes wrong and disrupts your business. It’s something I was just thinking about, when I read about the fire at Jim N' Nick's Bar-B-Que in Nashville, and something that Jeni’s Splendid Ice Creams likely benefited from a few years back during their production-kitchen closure, and something
From there, you can add on coverage that fits the particular needs of your business — anything from commercial vehicle coverage to cybersecurity. But while the name seems pretty comprehensive, a BOP wasn’t designed to handle every single insurance need that comes up as a business owner. Things like health and disability insurance and worker’s compensation won’t be part of a typical BOP.
Who a business owners policy is for
Since I set the stage with “this won’t be for all business owners,” it seems like it’d be worthwhile to dig into who, specifically, a BOP would fit.
I tend to recommend these to small and medium-sized businesses — anyone from, say, solo photographers and artists to the neighborhood coffee shop, but not usually companies that stretch beyond around 50 employees.
A BOP is designed to cover the basic needs of a business, and the larger a business is — both in terms of staff and scope — the more twists and turns usually come with its insurance needs.
A business owners policy, in a certain sense, is a starting point — it bundles up some of a small business person’s most common, basic coverage needs, and makes it affordable and relatively thorough. It might be the first business insurance policy you buy, but it’ll almost certainly not be the only policy you get.
What to look at beyond a BOP
If you call me about small business insurance coverage, I’ll end up asking you a lot of questions about how your business functions, to get a sense of where your vulnerabilities lie.
If you don’t have company cars and no one on your team drives for work, I likely won’t recommend commercial auto insurance. If your startup meal-service business is going to involve deliveries, obviously, that coverage is key. Whatever business you’re in, to err is human (and common), so Errors and Omissions Insurance is something I tend to recommend.
If online sales and payment processing is a big part of your business, more and more often, I see a lot of value in adding additional endorsements that cover things like cyber liability.
Whether you call Tucker Coverage or not, getting your business adequately covered means picking through the details of what you do, how you do it, and where something can go wrong. Which I know is a tall order, but an immensely valuable practice.