Which of the following could lead to the denial of coverage in a BOP?

Failing to notify the insurance company of an inoperative system is a critical factor that could lead to the denial of coverage in a Businessowners Policy (BOP). Insurance policies are predicated on the principle of utmost good faith (uberrima fides), which requires that the insured provide accurate and timely information regarding any changes or developments that could affect their risk profile. If an insured entity fails to inform the insurer about an inoperative system, such as a security system or fire alarm, that could increase the risk of loss, the insurer might determine that the lack of communication constitutes a misrepresentation or breach of the policy conditions. This could result in the denial of coverage for losses that occur while that system is inoperative, as well as any claims related to risks that the insurer was not made aware of.

The other options typically do not have the same direct bearing on coverage decisions. Having a physical store location generally aligns with the purpose of a BOP, which is designed for small businesses with physical premises. Generating less than $100,000 in annual revenue may affect the eligibility for certain types of policies or endorsements, but it does not inherently lead to a denial of coverage. Similarly, not employing more than two people may not disqualify