What Type of Insurance Do You Need as a Retailer?Posted on Nov 19, 2021
Owning a business comes with many responsibilities, such as providing each customer with high-quality products as well as providing exceptional customer service, but what do you do when an injury or damage occurs?
It’s important to maintain adequate insurance coverage for your brick-and-mortar retail store. Understanding the difference in policy options will help determine what type of insurance you need as a brick-and-mortar retailer.
What Does Brick and Mortar Mean?
A brick and mortar retailer refers to a business that offers a product or service at a physical location, like a retail clothing business, warehouse, or even a grocery store. Compared to running an online business, a brick and mortar business with employees and customers at a physical location is at an increased risk of experiencing property damage, lost or stolen goods, or a worker and/or customer experiencing an injury while on the property.
Understanding The Different Types of Brick and Mortar Insurance Options
There are several types of insurance coverage policies and options when it comes to insuring your brick and mortar retail business, and understanding the difference between each of them can be quite confusing. Below we have simplified the difference between the primary insurance policy options to make understanding what type of insurance you need easier.
Commercial General Liability Insurance
Commercial general liability insurance coverage, sometimes referred to as retail liability insurance, is one of the most important insurance policies a business owner can attain. This insurance is designed to help you with a lawsuit filed by a customer that has sustained an injury in your brick and mortar retail business, also known as a bodily injury claim.
No matter the type of retail business you own, there is a possibility of a customer sustaining an injury. Own a clothing store with several shelving units? General liability insurance will cover you if a shelf falls over or breaks, resulting in an injury to a customer.
Are you a restaurant owner? A customer may slip and fall on water spilled on the floor, sustaining an injury upon hitting the ground, leaving you susceptible to a lawsuit. This type of insurance will cover you regarding fighting the claim in court and/or settling outside of court with the customer.
Why Does Your Business Need Commercial General Liability Coverage?
Lawsuits are expensive. Regardless of the lawsuit’s outcome, cases take a great deal of time to sort out in court, expensive time with the cost of hiring a lawyer. Then there is the settlement itself. If a judgment is awarded against you, the numbers can be high – depending on the situation. Without the proper general liability coverage, you, as a retail business, have the burden to pay these costs, and, perhaps, you, personally.
Commercial general liability insurance helps to mitigate all or some of the costs a retail business may incur as a result of a lawsuit — from the settlement costs to court costs to judgment awards. The insurance will cover the costs up to the limits of the plan, less any deductibles outlined in your policy or policies.
Workers Compensation Insurance
As a storefront business owner, you likely have at least one employee working for you, if not more. Regardless of the safety measures and training put into place to avoid an injury, accidents happen, and an employee may sustain an injury or fall ill on the job.
A workers’ compensation insurance policy is responsible for paying the workers medical bills that accumulate from the injury and some or all of the lost wages. The workers’ compensation insurance requirements vary from state to state; therefore, you must speak to an agent within your state to understand the minimum standards.
Commercial Building Insurance
If your retail business is in a commercial building, you need commercial building insurance to provide coverage for damage to the physical structure that houses your retail operations. While specific protections vary by policy, items like vandalism, fire, wind, lightning, and storm damage are common coverages.
Business Personal Property
This refers to the property within your retail building (or within 100 feet of the retail premises) rather than the building itself. So, machinery, furniture, and merchandise for sale used in the business are covered under business personal property insurance.
Commercial Auto Insurance
Do you own a business that utilizes a delivery option? Commercial auto insurance is required to ensure you are adequately insured in the event of an accident. If you only have personal auto insurance and use a vehicle for business-related tasks, an injury sustained in an accident or any vehicle damage may not be covered.
Other Insurance Coverages You Might Need
In addition to the above core brick and mortar retailer insurance policies, your retail business may need the below coverages:
- Business interruption Insurance
- Flood insurance
- Employee Benefits
- Cyber liability insurance
- Umbrella excess liability
- Employment practices liability
Otterstedt Insurance Agency Supports Your Brick and Mortar Retailer Insurance Needs
The types of insurance coverage needed, as well as the amount of coverage necessary, will depend on the type, size, and location of a business. It is important to speak to an insurance representative local to you to ensure the minimum insurance requirements are met. As a business owner, you may think, “that will never happen to me,” but what happens when it does?
Ensuring you have attained adequate coverage for your brick and mortar retail store is essential should you find yourself on the receiving end of a lawsuit, the victim of criminal activity, or mother nature’s wrath.
Otterstedt Insurance Agency is dedicated to New Jersey retailers and other retailers in the U.S., meeting their commercial insurance needs. We understand the challenges you face, particularly now. We want to give you the tools you need to protect and defend your retail business if a lawsuit is levied or when accidents or other perils happen.