One uninsured loss can wipe out months — or years — of profit. This guide gives you the straight facts on what coverage you need and what it costs.
Core Coverage Types
| Coverage | Annual Cost | Need It? |
|---|---|---|
| General Liability | $800–$2,500 | Yes |
| Property Insurance | $1,200–$4,000+ | Yes |
| Business Interruption | $300–$800 | Recommended |
| Workers' Comp | $1,500–$4,000 | If employees |
| Equipment Breakdown | $400–$1,000 | Recommended |
| Umbrella Policy | $500–$1,500 | Multi-store owners |
What Is a BOP?
A Business Owner's Policy bundles general liability + property insurance + business interruption at 10–20% savings. Typical BOP cost: $2,500–$6,000 annually. Recommended for most single-store operators.
The Danger of Being Underinsured
- Flood scenario: Water heater burst, property policy excluded plumbing failure → $43,000 out of pocket
- Slip-and-fall: $500K liability limit, $650K settlement → $150K out of pocket
- Business interruption miss: No BI coverage, closed 6 weeks → $30,000 lost
Money-Saving Tips
- Bundle with a BOP (save 10-20%)
- Raise your deductible (save 10-15%)
- Install monitored security (insurance discounts)
- Shop every 2-3 years for competing quotes
- Pay annually (save 3-5%)
Budget $3,000–$6,000 annually for a solid BOP. Factor insurance into your deal analysis. Consider how security investments might lower your premiums.