General liability insurance vs. Business Owner’s Policy: What’s the difference?

Business Owner’s Policies (BOPs) and general liability insurance are 2 types of business insurance that cover similar liabilities. For small business owners, choosing the right kind of insurance can be overwhelming.

Should you have general liability Insurance or a Business Owner's Policy? And what's the difference? Let’s dive in to determine which coverage you need to make sure your business can stay up and running if something happens.

What is general liability insurance?

General liability insurance is one of the most important policies for small businesses. It’s meant to protect you against accidents or mistakes that happen within your company.

Coverage includes claims made against your business stemming from:

• Bodily injury if a customer is hurt on your business property
• Property damage for damage to a customer’s property
• Advertising injury for a copyright violation or causing harm to someone’s reputation

It generally covers everything from a slip-and-fall lawsuit in your store to an advertising claim if you use work in an ad that doesn’t belong to you (or that you didn’t have permission to use).

If you have general liability insurance and someone sues your business, you can use it to help pay for court defense costs and damages, too.

What is a Business Owner’s Policy?

A Business Owner’s Policy, or BOP for short, is the Swiss Army knife of business insurance. It combines the most necessary policies—general liability, business property, and business interruption insurance—into one convenient package.

A Business Owner’s Policy covers:

• Third-party lawsuits
• Damage to your building and its contents
• Loss of business income from a catastrophe that shuts down your business operations

Not all businesses qualify for this type of coverage. It’s designed specifically for low-risk small and medium-sized companies.

How are general liability and BOP insurance the same?

Many similarities exist between general liability and BOP coverage. For example, if you get a BOP, you won’t need to buy a separate general liability policy because BOP includes general liability coverage.

General liability and BOP coverage both include basic liability protection for small businesses:

• Premises liability (like slip and fall accidents)
• Property damage liability (damage to a client’s property or belongings)
• Advertising liability claims (using a copyrighted image in a marketing campaign)

You also have the option to customize both policies. If you have general liability or BOP insurance, you may want to add endorsements for product liability coverage, commercial auto insurance, or liquor liability coverage.

What’s the difference between general liability vs. BOP?

Business Owner’s Policy and general liability insurance cover similar types of losses and injuries, so they might seem interchangeable at first glance.

However, there are some essential differences between them that small business owners should consider when choosing coverage:

• General liability coverage includes bodily injury, damage to a customer’s property, and advertising claims only.
• BOP includes general liability—plus property insurance for your business and equipment and business interruption coverage.

Another difference is that a BOP isn’t available to every type of business owner. Typically, insurance companies offer coverage to small and medium-sized businesses with low risk.

So, you might not qualify if you have more than 100 employees or if your revenue is more than about $5 million. You might also be ineligible if you run a higher-risk business (construction or some types of restaurants).

When do I need more than just general liability insurance?

General liability is essential coverage for many types of businesses. If your business is open to the public, rents or owns commercial property, or works with clients and customers, it may be a smart move.

A BOP provides additional coverage besides general liability. Suppose you want insurance for damage or loss of your building, equipment, and inventory. In that case, a BOP makes sense—it generally offers more protection at a lower cost than buying each policy individually.

But sometimes, a small business owner has insurance needs beyond what a general liability insurance policy or BOP can offer. Other types of coverage may be vital to your business:

• Workers’ compensation insurance: Pays for medical expenses and lost wages if an employee has a job-related injury or illness.
• Errors and omissions insurance: Also known as professional liability insurance, it’s a type of malpractice insurance for lawyers, architects, insurance agents, and others that provide professional services.
• Commercial auto insurance: Covers a vehicle while it’s being used for business purposes.
• Commercial property insurance: Commercial general liability can include business property insurance and business personal property coverage.
• Data breach coverage: Provides cyber liability coverage for the loss or theft of private information.

Additional small business insurance depends on your industry and the type of business you run. For example, a restaurant or store that serves or sells alcohol should consider liquor liability insurance.

How much does a BOP vs. general liability insurance cost?

The average cost of general liability insurance with Huckleberry is around $76 per month, while business owners pay an average of around $72 per month for a BOP.

How much you pay for business liability insurance depends on the type of coverage you buy, your industry, and several other factors unique to your business and its location.

Keep in mind that general liability insurance is typically cheaper than BOP because it covers fewer scenarios. However, it also provides less coverage if something does happen.

How to get general liability or BOP coverage

General liability and BOPs are two of the most popular types of insurance coverage. So, how do you get it? Follow these steps:

1. Click over to our Small Business Insurance page.
2. Select the type of insurance coverage you need for your business.
3. Answer a few questions about your company, like what you do and where you’re located. (Don’t worry, we don’t ask questions that require a calculator!)
4. Get a no-commitment quote. Then, you can purchase your policy online instantly.

From start to finish, the process can take less than 5 minutes. Yes, it’s that easy to get insurance protection for your business.

If you own a small business, getting business insurance shouldn't be a hassle

There are many options out there for small business owners to secure insurance, but knowing what kind of coverage you need can be tricky. Luckily, Huckleberry is here to help.

We make small business insurance quick and easy, whether you need general liability, a Business Owner’s Policy, or additional insurance coverage. Get a business insurance quote in just a few clicks—no paperwork and no hassle.