Small Business Insurance
Consignment Shop Insurance
Running a consignment shop, like any other business, means that there is a potential for liability. To protect yourself in the case of a customer injury, faulty products, litigation, fire and many other bad events, you need to have a good small business insurance policy. Without proper coverage, your business can be at risk from the costs of medical bills, repairs, and litigation.
General Liability Insurance
Start off getting a good business insurance policy by having general liability coverage. This is a basic level of coverage that protects you from incidents that occur on your business premises, as a result of products that you sell, and in the case of a customer claim after the completion of business with them. As your business grows and you add more shops, you can expand this coverage to meet your needs. The main areas of coverage under general liability include:
General Liability Includes:
- Premises Liability – Because you have customers coming in and out of your shop, you need protection in your business insurance in case someone is injured on the location. For instance, if a customer slips and falls on a newly cleaned floor in your store, this coverage will help with any resulting medical expenses. This will also cover costs of repair or replacement of personal property of others.
- Products Liability – This type of coverage is especially important for a consignment shop. You are in the business of selling products and if one is faulty or causes injury, you will need protection through your commercial business insurance policy. This will cover expenses for medical care or damages caused by one of your products.
- Completed Operations – Another part of the general liability portion of your business insurance is completed operations. This protects you from claims that arise after business has been conducted. If a customer complains about a product well after they have bought it, this can cover any associated damages.
Business Owners Insurance Policy
To purchase a tailored package of commercial insurance for your consignment shop, you will likely get a business owners policy, or BOP. A BOP is a set of coverages that cover your specific needs as a shop owner. It will automatically contain general liability coverage, but the rest will be up to you. Examples of some types of coverage that you may select for your BOP are:
- Buildings and Contents
- Business Income and Extra Expense
- Electronic Data
- Newly Acquired or Constructed Buildings
- Employee Dishonesty Coverage
Workers Compensation Insurance
With a shop, you probably employ one or more employees. You should have workers compensation as part of your commercial insurance to cover medical costs, lost wages, and any other expenses that may arise if one of your employees needs it. This coverage extends to any employee who is injured or becomes ill during the course of business.
Commercial Umbrella Policy
Having small business insurance with general liability and workers compensation coverage may not be enough in the case of a catastrophic event. If something happens to destroy your shop and all its contents, your general liability and BOP limits might be too low to pay for everything. For this reason, you should consider adding commercial umbrella. This is extra insurance to pay for costs beyond what your general liability policy will cover.