Retail Insurance: Types of Retail Business Insurance

Posted 2 years ago by Max Komonov

Life can be桂unpredictable. No桂matter how careful you may be, accidents can happen anytime. That�셲 why having access to桂quality insurance is桂so桂important. Anyone who has a桂retail business knows that it�셲 impossible to桂control every possible situation. Retail insurance is桂an桂essential tool for桂any桂business, big or桂small.

What is桂Retail Insurance?

You may be桂wondering, 혫What is桂retail insurance?혬 Retail insurance is桂designed to桂offer protection to桂businesses in桂the桂event that something unexpected happens on桂their property. Such unexpected events include:

Damage or桂theft to桂business products, equipment, or桂tools
Cyber crimes or桂data breaches
Income lost due to桂damage done to桂the桂retail property
Accidents to桂customers that cause physical injury on桂the桂retail property
Accidents to桂employees that cause physical injury on桂the桂retail property
Natural disasters that damage retail property
Employees contracting an桂illness on桂the桂job

Retail insurance essentially offers financial support and桂can protect you from potential lawsuits. In桂many cases, proof of桂insurance may be桂expected by桂the桂landlord of桂the桂retail property before you are allowed to桂occupy the桂space. Clothing stores, jewelry stores, grocery stores, and桂even ecommerce businesses all rely on桂insurance to桂protect them in桂case of桂emergencies.

It桂is桂common for桂business owners to桂have general liability and桂commercial property insurance. While this may be桂enough for桂some businesses, it桂may not be桂enough for桂others. Depending on桂your particular business, added coverage such as桂business interruption insurance or桂commercial auto insurance may be桂necessary.

Types of桂Retail Business Insurance

In桂most cases, landlords will not allow you to桂conduct business on桂their property without basic retail business insurance. The most basic coverage starts with general liability insurance. General liability retail store insurance consists of桂the桂following:

General liability insurance

Protection against bodily injury. If桂a桂customer claims they were physically injured while interacting with your business, you may be桂responsible for桂legal or桂medical costs. This may include slips, falls, broken bones, and桂more. With general liability insurance, any桂legal, medical, or桂settlement costs will be桂covered by桂the桂insurer.
Protection against personal and桂advertising injury. This means that you are protected if桂someone sues you due to桂something an桂employee does or桂says. For instance, if桂an桂employee makes false claims about a桂competitor, causing the桂competitor to桂sue you. General liability will cover settlement costs.
Protection from property damage costs. If桂a桂customer or桂third party claims that you or桂your business has damaged their property, you will be桂covered by桂liability insurance. If桂you have an桂electronics business, this may include spilling coffee on桂your laptop or桂accidentally dropping and桂shattering your phone.

Commercial property insurance for桂retail

Commercial property insurance for桂retail businesses is桂also very common. The purpose of桂commercial property insurance is桂to桂protect your physical assets. This may include business documentation, inventory technology, computers, work equipment, furniture, outdoor or桂indoor signs, and桂damage to桂the桂building itself.

Commercial property policies will cover the桂following situations:

Vandalism
Lightning strikes
Unintentional fires
Explosions
Hail storms
Falling objects
Windstorms

In桂most cases, retail insurance companies will not cover earthquake or桂flood damage. Many insurers can offer additional coverage for桂such events.

Workers�� compensation insurance

This form of桂coverage is桂meant to桂cover work-related injuries or桂illnesses. Workers�� compensation is桂especially important for桂more physically strenuous jobs. For instance, if桂an桂employee is桂injured while lifting a桂heavy package, your insurance coverage will cover the桂medical bills.

Business interruption insurance

When accidents occur that put your business on桂hold, business interruption insurance is桂a桂valuable asset. For example, if桂a桂fire occurs on桂your property, causing you to桂shut down for桂several months, you will be桂covered for桂the桂income lost. This type of桂insurance may be桂helpful for桂businesses in桂locations where natural disasters frequently occur.

Commercial auto insurance

Businesses that rely on桂transporting goods often require commercial auto insurance. If桂any桂sort of桂accident, injury, or桂property damage occurs while on桂the桂road, you and桂your employee are covered.

Cybersecurity insurance

In桂recent years, cyber crimes have become increasingly problematic for桂businesses. This is桂especially true for桂online retailers. A桂very important form of桂business insurance for桂online retailers is桂cybersecurity insurance.

If桂your business gets hacked, you, your employees, and桂your customers may be桂at桂risk. This form of桂insurance will cover investigation and桂monitoring costs.

Business crime insurance

Do桂retail stores have insurance for桂theft? Thankfully, business crime insurance is桂available for桂businesses that experience fraud or桂theft. While commercial property insurance protects against damage and桂vandalism, it桂does not protect against those who steal from the桂store. Business crime insurance fills in桂the桂gaps that commercial property insurance leaves behind.

Product liability insurance

With product liability insurance, you are covered for桂any桂damage or桂injury caused by桂a桂defective product. This may be桂due to桂an桂electrical error, burns, lacerations, or桂more. Essentially, any桂injury costs caused by桂your product will be桂covered by桂this insurance policy.

Inland marine insurance

This form of桂insurance covers damage and桂theft while at桂a桂third-party location. For example, if桂your inventory is桂stolen from a桂warehouse holding your product, you will be桂covered for桂your losses. Weather events, vandalism, certain hazards, and桂theft are all covered with inland marine insurance.

Retail health insurance

What is桂retail health insurance? Essentially, retail health insurance is桂a桂policy that offers health coverage to桂employees (individuals and桂families). Depending on桂the桂plan, retail health insurance may offer coverage for桂emergency ambulance expenses, and桂room rent, hospitalization, nursing expenses, and桂more.

Equipment breakdown coverage

This type of桂coverage will help with the桂costs of桂broken or桂damaged equipment caused by桂operator error, mechanical issues, motor burnout, or桂power surges. Equipment breakdown coverage will pay to桂either fix or桂replace any桂damages.

Employee dishonesty coverage

If桂an桂employee steals company property or桂money, you will be桂covered with employee dishonesty coverage. It桂is桂possible to桂combine this coverage with a桂larger commercial crime policy.

Retail life insurance

What is桂retail life insurance? Retail life insurance offers quality life insurance policies to桂individuals within your company. This form of桂life insurance can be桂tailored to桂the桂employee�셲 needs.

How Much Does Retail Insurance Cost?

Many new business owners ask, 혫How much does retail store insurance cost?혬 A桂wide range of桂factors play a桂role in桂the桂cost of桂business insurance. Generally speaking, the桂more forms of桂coverage you require, the桂more expensive the桂cost.

Businesses that have a桂physical retail store may require worker�셲 compensation, liability insurance, commercial property insurance, business crime insurance, and桂more. While home-based businesses likely will not need as桂many forms of桂coverage.

The key factors that determine the桂cost of桂insurance include:

The location of桂the桂business
The number of桂employees
The number of桂policies required
The types of桂coverage and桂limitations of桂the桂policies
Business assets
The type of桂business you have
The industry you�셱e in
Insurance claims history

The price of桂coverage also depends on桂the桂retail value within the桂insurance market. What is桂retail value in桂insurance? The retail value is桂usually higher than what a桂plan is桂actually worth. This is桂to桂ensure the桂insurance company makes a桂profit. With this in桂mind, the桂cost of桂an桂insurance plan will also depend on桂its retail value.

Before selecting retail insurance that may offer expensive and桂unnecessary coverage, follow these steps:

Get clear about the桂risks associated with your business
Learn about what specific types of桂insurance will cover those risks
Decide whether or桂not you need additional support from an桂insurance broker
Learn about different providers and桂choose one that you believe is桂trustworthy
Purchase your coverage
Stay on桂top of桂insurance payments, and桂remember to桂review and桂renew your coverage each year.

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About The Author

Max has been working in the ecommerce industry for the last six years helping brands to establish and level-up content marketing and SEO. Despite that, he has experience with entrepreneurship. He is a fiction writer in his free time.

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