Georgia Property & Casualty Practice Exam

Which type of coverage is NOT typically included in a business owners policy?

1. Property coverage

2. Liability coverage

3. Umbrella coverage

4. Common policy conditions

The correct answer is: Umbrella coverage

Umbrella coverage is not typically included in a business owners policy (BOP). A BOP is designed for small to medium-sized businesses and generally bundles several essential coverages into one package, specifically property coverage for physical assets like buildings and equipment, liability coverage for third-party claims, and common policy conditions that outline the terms and conditions applicable to the policy. Umbrella coverage, however, is an additional layer of liability protection that goes beyond the limits of the primary policies, such as general liability or commercial auto policy. It provides broader coverage and higher limits when the underlying policies’ limits have been exhausted. As a separate and specialized policy, umbrella coverage is generally purchased in addition to a BOP to extend liability protection, rather than being an integrated part of it.