Shop insurance

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Page written by Chris Godfrey. Last reviewed on September 24, 2024. Next review due October 1, 2025.

There are hundreds of retail outlets in the US, and they sell everything from bed knobs and car parts to broomsticks and spices. However, despite this diversity, they have one thing in common – every shop needs shop insurance to protect them if the worst should ever happen.

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Why do you need shop insurance?

Shops are typically very busy places, with high levels of foot traffic, large volumes of goods on sale and sometimes, selling products or services that have the potential to cause personal injury or property damage. This means that although shops must only have employers’ liability cover by law (if they have staff other than the owner), it pays to have other insurance in place to cover accidents, mishaps, errors and omissions. One small accident could result in a compensation claim that costs tens or even hundreds of thousands of pounds. Few retailers could afford such a blow. Put more simply, operating a shop without insurance is just gambling with the business.

What does shop insurance cover?

Shop insurance is an umbrella term for a range of business insurances that can give retailers protection against almost every type of negative event. Important insurance includes:

Public Liability Insurance protects your shop if someone is injured, or their property is damaged because of the services that you or your business provides. This type of cover, also known as PL or Liability Insurance, is designed to protect your business against third-party claims for injuries or property damage from a customer or client, passer-by, or a visitor to your business premises – whether you’re at fault or not.
Employers’ Liability Insurance is a legal requirement for most US employers. EL protects you and your employees, (including those who no longer work for you), should they be injured or become unwell as a result of working for your business. EL typically covers the associated legal and compensation costs, and other damages of such events, but it can also cover accidental injury or damage caused by an employee to a third party, such as your customers.

Business Contents cover for shops can help to replace the contents of your business premises in the event of fire, flood, theft, and accident. Use contents insurance to pay for new fixtures and fittings, equipment, stock and samples, raw materials, and employees’ personal belongings if they’re damaged, lost, or stolen.

Product liability insurance (PLI) – also known as ‘product insurance’ – is designed to protect retailers from financial loss in the event that someone is harmed, or property is damaged due to the products that they supply. Important tip: In the event of an accident, your business could be held liable even if you only distributed the offending product and had nothing to do with its creation.

Business interruption insurance covers you for lost income if your store is unable to operate due to an unexpected event. This would include incidents such as: fire and flooding at your premises, or power blackouts. Major equipment failure. Supply chain issues beyond your control.
Stock insurance protects your important stock, helping to replace inventory that has been damaged, lost or stolen.

Other insurance that you may wish to consider:

Equipment insurance – if you’ve invested in expensive machinery, such as freezers or chillers, this type of cover can help you if it fails for reasons beyond the warranty or service contract. It may also pay for any other property damage – such as water leaks – that the equipment fault creates
Legal expenses cover – if a claim is made against you, this can help with legal bills such as solicitors’ fees and court costs. Some providers may also offer expert advice on a range of legal matters.
Money cover – this can protect any cash you keep in the till or locked in a safe on the premises. It may also cover money in transit, such as when you take your takings to the bank after cashing up.
Personal accident cover – if you were injured in an accident and forced to close your shop, personal accident cover could compensate you for the loss of earnings.

What extra levels of cover are available with shop insurance?

Not all retailers are the same. Some shops may need specialised cover to protect them if things turn for the worse. Stores that sell expensive jewellery, antiques, art and other unusual products may find that regular shop insurance policies do not give them the levels of cover they need. These sort of businesses will typically need a customised policy, or they should take out additional levels of cover with higher single-item limits.

Other types of shop may also require custom cover – for example, stores that sell alcohol will need loss of licence insurance, and shops that offer customers personal treatments, such as hair salons, nail salons, beauty parlours and tanning salons, may need higher levels of public liability cover, or professional indemnity insurance to protect them if a client says the treatments have harmed them and makes a compensation claim.

If you’re not sure what type of cover or how much cover you need, simply register with Swoop to discuss your options with a shop insurance expert.

How much does shop insurance cost?

Shop insurance can cost as little as $11 per month. However, the premium you pay will depend on a range of unique factors, such as the type of shop you run, what you sell, the scale of your business, where you are located, and the number of workers you employ.

How Swoop can help

All business involves risk, but that doesn’t mean you have to suffer the consequences if things go wrong. Don’t let an accident, mishap or error undercut your shop. Contact Swoop today to compare top-quality shop insurance from a range of providers and to discuss all your business insurance needs.

Written by

Chris Godfrey

Chris is a freelance copywriter and content creator. He has been active in the marketing, advertising, and publishing industries for more than twenty-five years. Writing for Wells Fargo Bank, Visa, Experian, Ebay, Flywire, insurers and pension funds, his words have appeared online and in print to inform, entertain and explain the complex world of US consumer and business finance.

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