Retail Insurance: What You Need to Know

Retail insurance is non-negotiable for business owners in this industry. The majority of small business owners understand just how crucial it is to be insured, but for retail establishments, this goes a step further. With all the moving parts that come with this kind of business—from store maintenance and inventory protection, to staff and customer safety—retail insurance is not something to overlook.

If you own a retail business, whether it’s a brick-and-mortar location, a mobile vendor booth, or an online eCommerce store, now is the time to look into retail insurance options. But is this insurance even affordable, is the expense worth it for your small business, and if so, what policy and coverage amount should you choose?

If you’re unsure about where to start in the process, here’s a breakdown of what you need to know about retail insurance in order to make the right decision. Don’t forget to learn more about our retail store business insurance when you’re ready to purchase your coverage.

Who Needs Retail Insurance Coverage?

As a small business owner, you might feel tempted to cut back on retail insurance and stretch your budget further. But the risks and liabilities of being uninsured can cost exponentially more than a premium each month. Below are some indicators that your establishment needs retail insurance, according to Fit Small Business:  

  • You lease or own a space that draws in public foot traffic.
  • You accept online transactions from an eCommerce website.
  • You have staff members on the payroll—or will in the future.
  • You need to protect inventory from theft or damage.
  • You store customer data and mail products to their addresses.
  • You or an employee uses a vehicle for business tasks.

Which Types of Policies Are Available?

Once you’re ready to shop around for coverage, a Business Owners Policy (BOP) tends to be the most comprehensive and affordable place to start. This policy can be flexed to the specific needs of your retail business, no matter how small it is right now, and within this BOP umbrella, there are numerous additional coverages you can also tack on for an extra layer of protection:

  • Commercial Property: This covers any loss and damage to the retail property.
  • General Liability: This covers any accidents or injuries that occur at your store.
  • Business Vehicle: This covers any trucks, cars, vans or trailers used for the business.
  • Worker’s Compensation: This covers any on-the-job injuries suffered by employees.
  • Equipment Breakdown: This covers any mechanical failures of business equipment, machinery and computers.
  • Debris Removal: This covers any extraction of debris off the property following a natural disaster event.
  • Builder’s Risk: This covers the construction of any new retail stores you build.
  • Cyber Liability: This covers any loss from business or customer data breaches.
  • Business Interruption: This covers any expenses or lost income if property damage leads to temporary closure.
  • Errors and Omissions: This covers any inadvertent errors that cause an injury.
  • Tenant’s (or Renter’s): This covers any repairs or maintenance if you rent a space.
  • Inland Marine: This covers the shipment of any items while they are in transit.
  • Fidelity Bonds: This covers any financial or property loss due to employee theft.
  • Ordinance or Law: This covers any demolition or rebuilding expenses if the store needs significant repairs.
  • Crime Insurance: This covers any burglaries from third parties or staff members.

What Are the Premiums and Deductibles? 

Finally, there is the question of cost which is likely at the forefront of your mind as a budget-conscious small business owner. While exact costs vary based on the business location, industry, revenue, history of claims, and insurance amount, we have broken down the costs of various types of insurance.

Below you’ll find a breakdown of common retail insurance costs for various types of retail establishments, along with types of insurance to consider.

Types of retail insurance:

  • General Liability (Important)
  • Business Owner’s Policy
  • Workers Comp
  • Auto Insurance

Estimated costs for various retail establishments:

Purchasing Retail Insurance for Your Business

The sooner you look into your retail insurance coverage options, the safer and more secure your business will be. Unpredictable events will happen, but with retail insurance, the overall risk is mitigated, so you can rebound quickly and thrive long-term.

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