Understanding Commercial Package Policies
BUSINESS INSURANCE BASICS
For small businesses without specialized risks, a Business Owners Policy—or BOP—may offer the basic property and liability coverage that you need. But if your company is growing in size and complexity—or you face specialized risks due to the nature of your business—you may want to consider purchasing a Commercial Package Policy, or CPP for short.
Customized Insurance Under One Policy
Like a BOP, a CPP enables you to bundle various types of coverage within a single policy. However, while a BOP has limitations—it is only available for certain types of smaller businesses and covers only a few types of risk—Commercial Package Policies are available for a wide range of businesses, and can be better customized to the specific needs of your business. Most CPPs begin with:
• Property Insurance—Covers damage or destruction of buildings, equipment, inventory and more. • General Liability Insurance—Covers costs if someone is injured at your business or from using your product or service. From there, you can add a range of coverages to your CPP, including: • Business Income Insurance—Also known as Business Interruption insurance, this replaces lost revenues and covers extra expenses in the event that your business has to shut down or relocate due to fire, wind damage or other covered losses. • Business Vehicle (or Fleet) Insurance—Covers vehicles owned and used by your business. • Business Crime Insurance—Covers losses from burglary, computer fraud, employee dishonesty and other business crimes. • Commercial Umbrella Liability—Increases and broadens liability coverage, filling in gaps left by other coverages. • Electronic Data Processing Coverage—Covers costs associated with the loss or damage of electronic data processing media or equipment. • Equipment Breakdown—Also known as Boiler and Machinery Insurance, this covers losses from the malfunction of heating, electrical, air conditioning, telephone systems and other equipment. • Employment Practices Liability—Covers costs tied to disputes with employees over termination, discrimination, sexual harassment and other employment issues. • Inland Marine—Covers the transport of goods over water and land, providing comprehensive protection for assets that are moveable or mobile in nature, while in transit—such as from a warehouse to a store—or in storage. • Pollution Liability—Covers costs related to pollution, including clean-up and personal injury.
A range of other types of insurance—covering professional liability, supply chain risk, terrorism, farming or ranching losses, and more—can also be included in a CPP. .
What a CPP Doesn’t Cover
A CPP can provide your business with coverage against a broad range of risks. That said, it’s important to recognize that your CPP will not include: .• Directors and Officers (D&O) Liability • Health and Disability • Life Insurance • Workers Compensation
These coverages must be purchased separately; discuss your additional insurance needs with your insurance professional.
Get the right insurance for your trucks—and save money, too
Five things you should consider before your next renewal
Your vehicle insurance could be as much as 40 percent of your total operating budget. A Regular policy review is essential in making sure you have the right insurance for your truck—and your business. Plus, you could save big buck if you qualify for additional discounts. To get started, ask yourself these five questions—then give your local agent a call.
1. Are all of my employees covered when they drive my trucks, even if they’re not listed on my policy?
You should always list employees who regularly drive your vehicles. Ask your insurance company if it covers temporary drivers as long as they have your permission to operate the vehicle. Some insurance companies will only cover drivers who are named on the policy. So, if you regularly employ temporary workers, you need to call your insurer and add them to the policy every time they drive to ensure they’ll be covered in an accident. Permissive use policies don’t require you to add temporary workers.
2. Will my policy pay to repair my employees’ personal vehicles if they get into an accident while running a business errand?
If you often send employees on business errands in their personal cars or trucks, or, if you use rental vehicles, consider adding optional coverages to your policy to protect those vehicles. In many cases, a standard commercial auto insurance policy won’t cover damages in case of an accident. Your agent or insurance company can walk you through all of your options.
3. Should I maintain my policy during the off-season if I’m not using my truck?
When the season’s over, consider switching to Comprehensive-only coverage instead of canceling your policy altogether. This coverage protects your vehicles against incidents like vandalism or hail that can happen when they’re sitting for long periods during the off-season. If you do decide to cancel your Liability insurance, check with the Department of Motor Vehicles first. There may be some additional steps you need to take to comply with the insurance laws in your state.
4. How quickly does my insurance company resolve claims?
Find out how long, on average, it takes your insurer to resolve claims. The faster they take care of your claim, the faster you can get back to work. Also, ask if your insurance will cover a rental vehicle or provide downtime payments. That way, if your truck’s out of commission, your business will stay profitable.
5. What can I do to control my insurance expenses?
Discounts can make a big difference, especially with commercial insurance. For example, an experienced business owner discount and a discount if you have a General Liability or Business Owner’s Policy. Other ways that you can save include increasing your deductibles and paying your premium in full.