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Insurance · Commercial Property

What is a Business Owners Policy (BOP) designed to provide?

Reviewed by Jordan Morley, Editorial Lead at 247SimpleTests. Written by the 247SimpleTests Editorial Team from the official source material cited on every question.

Correct answer

A package policy for small to medium businesses that typically combines commercial property coverage and general liability coverage (and often business interruption) in one policy

  1. A A package policy for small to medium businesses that typically combines commercial property coverage and general liability coverage (and often business interruption) in one policy
  2. B Only auto coverage
  3. C Only workers compensation
  4. D Only personal homeowners coverage

Why this is the answer

A Business Owners Policy (BOP) is a package policy designed for small and medium-sized businesses that combines several common coverages into one convenient, often cost-effective policy. It typically includes commercial property coverage (for the building and business personal property), general liability coverage (for third-party bodily injury and property damage claims), and usually business interruption (business income) coverage, which replaces lost income if operations are suspended by a covered loss. A BOP does not include workers compensation or commercial auto, which are separate. Understanding what a BOP bundles is standard commercial-property content on the property insurance exam.
Source: NAIC Model Outline, Business Owners Policy

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About this topic: Commercial Property

Commercial property questions cover the building and personal property form, business income and extra expense, causes-of-loss forms, coinsurance and the commercial package policy. This is one of 11 Property Insurance questions on commercial property, each with a full explanation on a single study page.

New to this exam? Our Insurance exam guide explains the format, scoring, and how to prepare.

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