Retail insurance is usually a combination of policies designed to protect retail owners against the risks that often come with selling merchandise. Whether you have a brick-and-mortar store or operate exclusively online, protecting yourself from potential liability makes a lot of sense.
Why Retailers Need to be Insured
As a retailer, you interact with the public every day, which can expose you to unique risks from a variety of angles. Whether you are faced with property damage, inventory theft, equipment failure, or other unforeseen circumstances, having the right insurance plan in place can go a long way towards protecting you, your merchandise, and your overall investment.
What Does Retail Insurance Usually Cover?
This type of insurance usually includes several policies. This can vary depending on your insurance provider and on the scope of coverage you feel you need, but generally, a retail package will include the following:
General Liability Insurance
Also called “slip-and-fall insurance,” this policy is important to have if you offer an in-person shopping experience. If a customer injures themself in your store, this will protect you against claims of third-party bodily injury (including payment of any medical expenses incurred by the injured party). This will also protect you against claims of false advertising.
If you operate out of a bricks-and-mortar location (even if it’s just your own house), the need for this type of insurance is self-evident. It not only protects your building but also your inventory from events such as fire, flooding, or theft. For those retailers selling products directly from home, they are often surprised to find there is much that their homeowner’s insurance does not cover them for.
Product Liability Insurance
Whether you operate online or in person, this type of coverage is absolutely essential for anyone who sells a product. It will cover legal expenses following a claim of bodily injury or third-party property damage that was caused by a product you sell, manufacture, or distribute. It will also cover the medical expenses incurred by a customer who claims they were injured or made ill by your product.
Cyber Liability Insurance
Even if you are not selling from an online platform, any retailer who has a point-of-sale system or a loyalty program that stores customer data needs to have this type of insurance. It will protect you against any damages associated with cybercrime, which is exponentially on the rise.
Special Considerations for Online Retail and E-commerce
With more and more businesses existing exclusively online, there are some retailers who think that perhaps they don’t need insurance. This couldn’t be further from the truth. Your inventory still needs to be protected, and you may be at greater risk for cyber fraud than retailers who are dealing with customers face-to-face.
In many cases, online retailers are not seeing the products they sell up close before they get shipped, meaning there is a higher likelihood of not catching defective workmanship or other issues that could spark a lawsuit.
To learn more about your options for retail or other types of business insurance, contact us today at ISU Armac.