What basis does the property section of a businessowners policy (BOP) provide coverage on?

The property section of a businessowners policy (BOP) provides coverage on an open perils basis, which is a comprehensive approach to insurance coverage. This means that the policy will cover all risks of physical loss or damage to property, except for those specifically excluded in the policy.

Open perils coverage offers more extensive protection for the insured property compared to other types of perils coverage, such as named perils or specified perils. Named perils policies list specific perils that are covered—if a loss occurs due to a peril not on the list, there is no coverage. In contrast, the open perils approach automatically includes a wider range of potential risks, providing peace of mind as long as the loss isn't due to an excluded cause. Understanding this distinction is crucial for policyholders in order to assess their insurance needs effectively.