Insurance for Retail Stores

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There are a few reasons why retail businesses need insurance. Retail stores need insurance to protect against accidents, thefts, and property.

Flower Shop Retail Blooming Plant Store

Why do retail stores need insurance?

There are a few key reasons why retail businesses need insurance:

  1. Accidents happen! Even if you have created a safe and secure space for your employees and customers, accidents can and will happen! You need to protect yourself financially for the costs that employees or customers may incur in the case of an accident.
  2. Theft happens! Unfortunately, theft is also something that can and will happen. Insurance can help you cover the cost to replace stolen goods, equipment or supplies and keep the cost of running your business down.
  3. Data theft happens! In this day and age, most companies, including retail businesses, store data online. Another form of theft that has become more and more common is data theft or other malicious online behaviour. Insurance can protect you from the costs that are associated with data breaches.
  4. Your property needs to be protected. Your retail business often relies on physical property: the building you own or lease and everything inside it. Insurance can mitigate against the cost of repairs, replacing equipment or covering losses that result from other unforeseen circumstances.
Big red doors looking into a retail store

What types of insurance should a retail store have?

The type of insurance coverage your retail business needs will vary based on your activities, but the most common are:

  • Business liability: Also known as commercial general liability insurance. This covers you in the case an injured customer takes legal action against your business. It will help cover the costs associated with lawsuits.
  • Business interruption: As a business owner, one of your most valuable and scarce resources is time. Business interruption insurance will help your business get back up and running as quickly as possible, in the case of an insured event. It will ensure the costs associated with getting back up and running are controlled.
  • Employee protection: To attract the best talent, providing group benefits can be key. Employees and their families are protected with group benefits like life insurance and health and dental coverage.
  • Property insurance: Commercial property insurance (also called commercial contents insurance) protects the things inside your retail business, like equipment, inventory or furnishings. Property insurance will pay for the costs associated with repairing or replacing damaged or stolen items from your retail business.
  • Commercial auto: Commercial automobile insurance is extremely necessary if your business uses a commercial vehicle for any purpose (to make deliveries, to pick up supplies, to transport employees). Commercial auto insurance will protect you in the case that the company vehicle is involved in an accident.
  • Personal home and auto: Many small business owners find it most efficient to bundle their business insurance with their personal (home and/or auto). Many insurance brokers will work with their clients to ensure they are fully covered both personally and commercially.

Why do retail stores need insurance?

As you can tell, pretty much every retail business has a reason to have insurance. Here are a few examples of businesses that benefit from retail insurance and the situations when a claim may arise:

  • Florists: Florists often make deliveries, using a commercial vehicle. In the event that your employee gets into an automobile accident while out making deliveries, commercial auto insurance will cover costs associated with the accident.
  • Print and copy shops: Print and copy shops often have thousands of dollars (or more!) worth of specialized printing and copy equipment (printers, scanners, photocopiers). If an employee accidentally damages a piece of equipment, property insurance will cover the cost of repairs.
  • Clothing stores, fashion and accessories stores: These types of retailers are often prone to theft. Property insurance will cover the cost of replacing store inventory.
  • Bakeries, specialty food stores and cafes: Bakeries and cafes often have customers coming and going throughout the day. With lots of customer activity, there’s the possibility of a customer slipping and falling (especially during those winter months). If a customer were to sue you, due to an injury incurred at your retail business, business liability insurance will cover the costs associated with the lawsuit.

How much will insurance for my retail business cost?

The cost of a retail insurance package will vary depending on the type of retail business you operate and the types of insurance coverage you need. For example, if you do not deliver or use a commercial vehicle, your business likely doesn’t need commercial auto insurance.

Some factors that will be considered when your insurance company determines the cost of your retail insurance are:

  • Years of experience in the business
  • The size and location of your retail business
  • The number of employees you have
  • Your annual revenues and your income projections
  • Your past history of insurance claims

We recommend you reach out to your insurance broker and have a fulsome discussion about how you operate your business, to ensure that you are as protected as possible.

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