Running a flooring installation business means juggling a lot of risks. You're working in other people's homes and businesses, hauling expensive equipment from job to job, and one accident—a water-damaged subfloor, a stolen tile saw, or a slip-and-fall injury—could cost you thousands. That's where a Business Owners Policy comes in.
Here's the thing most flooring contractors don't realize: buying general liability and property insurance separately usually costs about 10% more than bundling them into a BOP. Plus, you'll save time dealing with one policy instead of two. But a BOP isn't right for every flooring business, and there are some important gaps you need to know about. Let's break down when a BOP makes sense, what it actually covers, and what you'll still need to buy separately.
What Is a Business Owners Policy?
A Business Owners Policy is essentially a bundle deal. It combines three types of coverage into one package: general liability insurance, commercial property insurance, and business interruption coverage. Think of it like getting insurance for your tools, your liability exposure, and your income all under one roof.
The general liability portion covers you if a client claims you damaged their property or someone gets hurt on a job site. Say you're installing hardwood and accidentally scratch a customer's antique dresser while moving it—that's covered. Or if a homeowner trips over your nail gun and breaks their wrist, your BOP handles the medical bills and potential lawsuit.
The commercial property part protects your business equipment and inventory. If your van gets broken into and thieves steal $8,000 worth of saws, sanders, and nail guns, you're covered. If a fire destroys your warehouse full of vinyl plank inventory, you're covered. And if you rent office or storage space and a pipe bursts, damaging your equipment, that's covered too.
Business interruption coverage is the part most people overlook until they need it. If a covered event—like a fire or major theft—shuts down your operations, this coverage replaces your lost income while you get back on your feet. For a flooring installer, that might mean covering payroll and rent while you replace stolen equipment or wait for your shop to be repaired.
When Does a BOP Make Sense for Flooring Installers?
Insurance companies have pretty specific rules about who qualifies for a BOP. You need to be a relatively small operation—most insurers set the bar at less than 100 employees and under $6 million in annual revenue. If you're a solo installer with a couple of helpers, you're well within those limits. Even if you run a small crew of 10-20 people, you'll likely qualify.
There's also a square footage requirement. Your business location—whether that's an office, showroom, or storage facility—usually can't exceed 35,000 square feet. For most flooring contractors, that's not an issue since you're doing the actual work at client sites.
A BOP makes the most sense if you're a small, low-to-moderate-risk flooring business. If you primarily install residential flooring, work on small commercial jobs, and carry a reasonable amount of equipment and inventory, a BOP is probably your best bet. It's cost-effective, covers your most common risks, and meets the insurance requirements most general contractors will demand before they let you on a job site.
On the other hand, if you're running a larger operation with more complex needs—maybe you manufacture custom flooring products, operate a large retail showroom, or handle high-value commercial projects—you might need a commercial package policy instead. These offer more flexibility and customization but cost a bit more.
The Real Cost Savings of Bundling
Let's talk numbers. The average BOP for flooring installers runs about $109 per month, or roughly $1,300 per year. If you bought general liability and commercial property insurance separately, you'd likely pay 10-15% more—somewhere in the neighborhood of $1,450 to $1,500 annually. That's $150 to $200 saved just by bundling.
If you're running a really small operation—maybe you're just starting out or you only work part-time—you can find BOPs starting as low as $25 to $50 per month. About 42% of small businesses pay less than $50 monthly for their BOP, and another 30% pay between $50 and $100. Where you fall in that range depends on factors like your location, your claims history, how much equipment you own, and your annual revenue.
You can also stack additional savings. Many insurers offer 5-15% discounts if you bundle your BOP with other policies like commercial auto or workers' compensation. If you're paying $147 per month for your BOP, bundling could save you another $7 to $22 monthly. Over the course of a year, these discounts add up.
Your deductible also plays a big role. If you choose a higher deductible—say $2,500 instead of $500—your monthly premium drops. Just make sure you have enough cash on hand to cover that deductible if you need to file a claim.
What a BOP Doesn't Cover
This is where a lot of flooring contractors get tripped up. A BOP is great, but it's not a catch-all policy. There are some major gaps you need to fill with separate coverage.
First, a BOP doesn't cover your vehicles. If you're driving from job to job—which, as a flooring installer, you absolutely are—you need commercial auto insurance. Your personal auto policy won't cover you if you're using your truck or van for business purposes. And if you get into an accident while hauling materials to a client's house, you could be on the hook for tens of thousands in damages.
Second, a BOP doesn't cover employee injuries. If one of your workers hurts their back lifting a pallet of tile, that's a workers' compensation claim, not a BOP claim. Most states legally require you to carry workers' comp if you have employees, so this isn't optional.
Third, professional liability—also called errors and omissions insurance—isn't part of a standard BOP. If a client claims you gave bad advice or made a mistake in your work that caused financial loss, general liability won't help you. For example, if you install the wrong type of flooring for a high-moisture area and it warps, causing the client to sue for the cost of replacement and lost business income, you'd need professional liability coverage.
Lastly, cyber liability isn't included. If you store customer credit card information or other sensitive data and it gets hacked, you'll need separate cyber insurance. This is becoming more important as even small businesses face data breach risks.
How to Get Started with a BOP
Getting a BOP is straightforward. Most insurers let you get a quote online in minutes—you'll need to provide details about your business like your annual revenue, number of employees, the value of your equipment and inventory, and your business address. Many providers can issue a certificate of insurance immediately after you purchase, which is helpful when a general contractor needs proof of coverage before you start a job.
When shopping for a BOP, compare at least three quotes. Prices can vary significantly between insurers, and you want to make sure you're getting the coverage limits you actually need. A bare-bones policy might seem appealing because it's cheap, but if your coverage limits are too low, you'll be paying out of pocket when a claim exceeds those limits.
Also, ask about add-ons. Some insurers offer endorsements for things like hired and non-owned auto liability (which covers you if you rent a vehicle or use an employee's personal car for work), employment practices liability, and employee benefits liability. Depending on your business, these might be worth adding to your BOP.
A Business Owners Policy is one of the smartest investments you can make as a flooring installer. It protects your equipment, your income, and your business from lawsuits—all while saving you money compared to buying separate policies. Just remember, it's not a complete insurance solution. Pair it with commercial auto and workers' comp, and you'll have solid protection for the risks you face every day on the job.
