Mar 13, 2025

What Is a Package Policy and Why Do Businesses Need It?

Running a business is no small feat — just ask the 33 million small businesses across the United States that power the economy. From property damage to liability claims, the risks are as diverse as the industries they represent. Yet, managing multiple insurance policies can quickly become overwhelming and expensive. That’s why many businesses opt for business insurance in the form of a package policy. By bundling essential coverages into a single, streamlined plan, a package policy simplifies risk management while offering cost-effective protection against the unexpected.

These policies simplify insurance management, reduce coverage gaps, and provide comprehensive protection. Whether you run a small retail shop, a restaurant, or a growing service business, understanding how a package policy works can help you make smarter decisions about risk management.

What Is a Package Policy?

A package policy is a type of business insurance that combines multiple coverages under one policy, offering businesses a more efficient way to manage risk. Instead of purchasing individual policies for general liability, commercial property, and other essential protections, a package policy consolidates them into one convenient plan.

Unlike standalone policies, which cover specific risks separately, a package policy allows for flexibility by tailoring coverage to a business’s unique needs. This coverage is particularly useful for small and midsized businesses that require broad protection without the hassle of managing multiple policies.

Key Coverages Included in a Business Insurance Package Policy

The coverages included in a package policy depend on the insurer and the business’s specific insurance needs, but they often include:

  • General liability insurance: Protects against third-party claims for bodily injury, property damage, and advertising injuries
  • Commercial property insurance: Covers buildings, equipment, and inventory from damage caused by fire, theft, and natural disasters
  • Commercial auto insurance: Provides coverage for company-owned vehicles used for business purposes
  • Crime insurance: Helps protect against financial losses from fraud and employee theft

It’s important to note that package policies do not typically include workers’ compensation or group life insurance, which require separate policies.

Package Policy Vs. Business Owners Policy (BOP)

A business owners policy (BOP) is a type of package policy designed specifically for small businesses. While both package policies and BOPs bundle coverages, BOPs generally include a more limited set of coverages tailored to small-business needs, whereas a package policy offers greater customization and broader protection options.

Benefits of a Package Policy for Businesses

A package policy provides several advantages, making it a valuable choice for many businesses. Bundling multiple coverages into one policy often results in lower premiums than purchasing standalone policies separately. 

It’s also more streamlined — instead of juggling multiple policies and renewal dates, businesses can manage their coverage more efficiently. Additionally, investing in a package policy reduces the likelihood of coverage gaps by including essential protections in a single policy.

Who Benefits Most from a Package Policy?

Many industries can benefit from a package policy, particularly:

  • Small and midsized businesses that need essential coverages without excessive costs
  • Retail stores and restaurants that face liability risks from customers and property damage risks from fire, theft, or weather-related events
  • Professional service providers such as law firms, consultants, and marketing agencies that need liability and property protection

Choosing the Right Package Policy

To find the right package policy for your business, consider the following:

  • Assess your risks: Identify your industry’s most common risks, and ensure your policy addresses them.
  • Work with an experienced insurance broker: A knowledgeable broker, like Oakwood Risk Insurance, can help tailor a package policy to meet your needs.
  • Review coverage options and policy limits: Not all package policies are the same, so understanding what’s included and excluded is crucial.

Protect Your Business With the Right Coverage

A package policy is a smart investment for businesses looking to streamline insurance coverage while maximizing protection. Whether you’re a small business or a growing company, having the right insurance for your small business can safeguard your assets and financial future.

Contact Oakwood Risk Insurance today to explore customized package policy options that fit your business needs.

Oakwood

Oakwood Risk provides industry-leading insurance services, solutions, and counsel to our clients. Our professionals are valued for their ability to provide outstanding customer service, with a commitment to the relentless pursuit of value-added solutions, results, and comprehensive coverage.

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