A business owner’s policy, frequently abbreviated as BOP, is an insurance policy you would buy to protect your business from a wide variety of property and casualty risks. Bundled into a single package, a practice BOP typically covers your clinic for events ranging from fire to theft or a general liability claim against your office.
Many insurance companies offer standardized policies that cover the needs of average businesses. One thing you need to remember as a practice owner is that you are not running an “average business.” You have special needs and will want to make sure that your BOP is suited to the specific nuances of your dental practice.
Prior to making any changes to business owner policies, consult with an advisor who truly understands your marketplace and will help you identify insurance companies that allow for strong medical and dental endorsements. This is the most effective way to ensure you have the coverage you need to safeguard your practice and livelihood.
Employment practices liability insurance (EPLI) covers things like wrongful termination, discrimination, and sexual harassment.
In our experience, lower-level employees in dental practices tend to be quite transient. With so many people coming and going, the chances of an employment related lawsuit are greatly increased. For that reason, you’ll want to make sure you have increased limits in your base policy, or even a separate EPLI policy.
Data breaches are becoming more common, with the Department of Health and Human Services (HHS) Office for Civil Rights (OCR) reporting that there were 725 healthcare data breaches resulting in more than 133 million records being exposed or disclosed without permission in 2023 alone. However, many base BOPs don’t have coverage for data breaches.
Data breach protection is typically added to your business owner’s policy. The coverage may help mitigate data loss or theft costs and may include data breach preparedness and response services. We suggest our clients to obtain coverage as high as they can, based on the size of their practice.
If your office burns to the ground, and you lose paper or electronic records that are not backed up, you may not be able to prove how much you had in accounts receivable. Insurance companies require you to have sufficient records to adequately document your accounts receivable if you need to produce them as a result of a claim. Base coverage in a BOP policy is usually not sufficient and needs to be reviewed and tied to your average accounts receivable balance.
Another area that is frequently misunderstood by dental practice owners is auto coverage. Let’s say one of your employees gets into a car accident while taking care of a work-related activity using her car. You might be liable! Make sure your dental practice BOP insurance has coverage for incidents that involve non-owned automobiles.
In the world of property and casualty insurance, it is really important to be crystal clear as to whom or what the insurer is actually protecting at the time of the claim (not when you take out the policy).
Many practitioners own the building that houses their practice. As a result, often a lease agreement is not a priority, and this is where trouble ensues. If you don’t properly document the lease agreement between the property and practice, and make sure it matches coverage limits for each responsible party (property owner vs. tenant), you might run into problems when it’s time to file a claim. Even with practices that do not own the physical office, it is important to ensure the BOP policy matches the tenants’ responsibilities under their lease.
Don’t let the weaknesses of a standard BOP become weaknesses within your business. Work with an insurance specialist who understands the risk management needs of your practice, and put into place the necessary BOP modifications to make your policy strong.
When evaluating your coverage options, keep in mind that dental practice business insurance should be tailored to your specific operational and legal risks, not just pulled from a standard playbook. These and other dental practice tips can help you make informed decisions that protect your livelihood and support long-term success.
For a deeper dive into important insurance considerations you need to know as a practice owner, download our complimentary guide: The Practice Owner’s Guide to Business Coverage.
Treloar & Heisel, an EPIC Company, is a premier financial services provider to dental and medical professionals across the country. We assist thousands of clients from residency to practice and through retirement with a comprehensive suite of financial services, custom-tailored advice, and a strong national network focused on delivering the highest level of service.
Insurance products offered through Treloar & Heisel, LLC.