Here's what most accountants and CPAs don't realize until they actually need it: the biggest risks to your practice aren't necessarily about the tax returns you file or the audits you perform. Sure, professional mistakes matter—but what happens when a client trips over a box in your office lobby and breaks their ankle? Or when a burst pipe floods your workspace, destroying computers and forcing you to shut down for two weeks? That's where a Business Owners Policy comes in.
A BOP is essentially a two-for-one insurance deal designed specifically for small businesses like accounting practices. It combines general liability coverage with commercial property insurance, and typically costs 15-25% less than buying those policies separately. For most CPAs, that translates to around $400-700 per year for solid protection. Let's break down when a BOP makes sense for your accounting business and what you're actually getting for your money.
What's Actually Included in a BOP for Accountants
Think of a BOP as your basic business protection package. It rolls three main coverages into one policy. First up is general liability insurance, which handles the physical risks of running a business. If a client slips on your icy sidewalk, spills coffee on their laptop while meeting at your office, or claims your employee damaged their property during a site visit, general liability steps in. It covers their medical expenses, legal defense costs if they sue, and any settlement or judgment against you.
The second piece is commercial property insurance. This protects your physical business assets—your computers, printers, furniture, filing cabinets, and any specialized equipment you use. It covers both property you own and spaces you lease. Whether you're working from a rented office suite or own your building, property insurance handles damage from fires, theft, vandalism, certain weather events, and other covered perils. Your client files and business documents are typically covered too, though you'll want to verify limits on business records with your insurer.
The third component is business interruption coverage, and honestly, this might be the most overlooked but valuable part. If covered property damage forces you to close temporarily—say, fire damage requires office repairs—business interruption insurance replaces your lost income during the shutdown. It also covers the extra costs of keeping your business running, like renting temporary office space or replacing destroyed equipment on short notice. During tax season, this coverage can be a lifesaver if disaster strikes at the worst possible time.
When a BOP Makes Sense for Your Accounting Practice
BOPs are designed for small, low-risk businesses, and most accounting practices fit that profile perfectly. If you're a solo CPA, a small firm with a handful of employees, or a boutique practice focused on tax preparation and basic bookkeeping, a BOP is probably your sweet spot. These policies work particularly well for firms operating from a single office location without major hazards or specialized operations.
Revenue limits can affect BOP eligibility, though the specific thresholds vary by insurer. Generally, if your annual revenue stays under $5-10 million and you're not dealing with extraordinarily complex or high-risk services, you'll qualify. The typical BOP for accounting professionals includes policy limits of $1 million per occurrence and $2 million aggregate with a $500 deductible—enough coverage to satisfy most client contracts without being overkill.
However, there are situations where a BOP might not be the right fit. If you offer specialized forensic accounting services, expert witness testimony, or handle audits for publicly traded companies, your risk profile might exceed what standard BOPs cover. Firms with multiple office locations, significant international operations, or very high revenue often need customized commercial package policies instead. And if you're working from home without dedicated office space or storing substantial business property, you might not need the property coverage component at all.
The Big Gap: What BOPs Don't Cover
Here's the critical thing to understand: a BOP covers physical risks, but it doesn't protect you from professional mistakes. That calculation error that cost your client thousands in penalties? The missed deduction that triggered an audit? The bad tax advice that led to a lawsuit? None of that is covered by a BOP. For that, you need professional liability insurance, also called errors and omissions (E&O) insurance.
This distinction trips up a lot of accountants. You might think you're fully covered with a BOP, but the reality is that most claims against CPAs stem from professional services, not slip-and-fall accidents. The good news is that many insurers offer attractive bundle discounts—typically 10-20% savings—if you add professional liability to your BOP. Some states, like Nevada and Oregon, actually require CPAs to carry professional liability coverage with specific minimum limits, especially if you're incorporated or operating as an LLP.
BOPs also typically exclude cyber liability coverage, which is becoming increasingly important for accounting firms handling sensitive financial data. Employee-related issues aren't covered either—you'd need employment practices liability insurance for wrongful termination or discrimination claims. And workers' compensation for employee injuries is always a separate policy, often mandated by state law if you have employees.
Real-World Cost Expectations
For a small accounting firm with two employees, you're looking at roughly $390 annually on the low end, or about $32 per month. The average sits closer to $56-60 monthly, or around $670-720 per year. Those numbers are based on 2025-2026 market data and assume standard coverage limits of $1 million per occurrence and $2 million aggregate.
Your actual premium depends on several factors. Location matters significantly—a CPA in Maine might pay $27 monthly while the same practice in Pennsylvania could cost $38 for identical coverage. States with less litigation tend to have lower premiums. Your annual revenue, number of employees, claims history, and specific services offered all influence pricing. If you're offering higher-risk services like forensic accounting or litigation support, expect higher premiums. Conversely, basic tax prep and bookkeeping services typically qualify for the lowest rates.
The real value proposition is the savings versus buying separate policies. Purchasing general liability and commercial property insurance individually typically costs about 10-15% more than getting them bundled in a BOP. Some sources cite savings as high as 15-25%. That might not sound dramatic, but over years of coverage, it adds up. Plus, dealing with one policy, one renewal date, and one insurer for your basic business coverage simplifies your administrative life considerably.
Client Requirements and Contract Considerations
Even if your state doesn't legally require insurance—and most don't for CPAs—your clients might. Corporate entities, government agencies, and larger businesses routinely require proof of insurance before they'll engage your services. Their contracts typically specify minimum coverage amounts, often $1-2 million in general liability and similar limits for professional liability.
If you're pursuing Fortune 500 clients or publicly traded companies, expect even higher requirements—professional liability limits of $3-5 million aren't uncommon. Your BOP's general liability portion helps meet baseline requirements, but remember you'll still need separate professional liability coverage for most client contracts. The combined package shows clients you take risk management seriously and protects you from both professional and general business risks.
How to Get Started with a BOP
Shopping for a BOP doesn't have to be complicated. Start by inventorying your business property—computers, furniture, equipment—to determine how much property coverage you need. Consider your office lease terms and any contractual insurance requirements. Review any existing client contracts to see what coverage limits they require.
Get quotes from multiple insurers specializing in professional services or accounting firms specifically. Carriers familiar with your industry will understand your risk profile better and often offer more competitive pricing. Ask about bundle discounts if you're adding professional liability or other coverages. Compare not just premiums but deductibles, coverage limits, and any special endorsements or exclusions relevant to accounting practices.
Don't assume the cheapest option is the best. Read the actual policy language, especially exclusions and conditions. Make sure business interruption coverage includes adequate waiting periods and coverage duration for your practice. If you store client records or have specialized software, verify those are covered at appropriate limits. And revisit your coverage annually—as your practice grows, your insurance needs will evolve too.
