What coverages are provided under section 1 and section 2 of the business owners policy?

The business owners policy (BOP) is designed to cover small to medium-sized businesses with a combination of property and liability coverage. In section one of the BOP, businesses are provided with property coverage, which protects the physical assets of the business, including buildings, equipment, inventory, and personal property. This coverage helps policyholders recover from losses due to events such as fire, theft, or vandalism.

Section two of the BOP focuses on liability coverage. This aspect of the policy protects the business against claims from third parties for bodily injury, property damage, and personal and advertising injury. It helps cover legal costs, settlements, or judgments that may arise from lawsuits related to these claims.

This clear division into property and liability coverage is crucial as it ensures that businesses have comprehensive protection against both types of risks they may face. Recognizing this separation allows business owners to understand their exposures and the protections they have in place through their insurance policy.