What is shop insurance?
Shop Insurance can include many aspects of cover from buildings and contents, stock, money, public liability, employee liability, professional indemnity, legal expenses, business equipment and terrorism if required.
Employee liability is a legal requirement if you have employees in your shop. Public liability insurance is essential for peace of mind to protect you against compensation claims if someone is injured in your shop.
Do I need shop insurance?
Business owners are legally required to have employers’ liability insurance, if you have employees or volunteers working in your shop. Other policies aren’t mandatory, but they can offer financial coverage for a range of circumstances that could otherwise be costly.
You need it for peace of mind against public liability compensation claims for anyone who comes into your shop as well as stock cover against insured perils such as fire, lightening, theft and accidental damage.
Features of shop insurance
- Public liability - you are responsible for making your shop as risk free as possible, but accidents can still happen. Public liability insurance will cover loss, damage or injury to a third party on your premises. For example – if a customer were to trip on a ladder left out after reaching a high shelf and injure themselves, your public liability cover could pay out in the event of a claim.
- Employers Liability – cover is a standard £10M and will protect you as the employer against claims from your staff should they be hurt when working for you. If you have students or employees and then by law, you are required to have employer’s liability insurance.
- Buildings insurance – Whether you own or rent the building, should the worst happen, and the property becomes damaged or is destroyed your building insurance will cover you to repair or rebuild. The rebuild cost is the amount you should insure for in case you need to completely re-build from the ground up. This cost should be detailed in the deeds of the building but can also be obtained from a surveyor or using an online calculator.
- Business interruption - Business interruption insurance pays the outgoings such as overheads, wages or increased cost of working expenses in the event of a claim. Business interruption is support that sees you through while things are being fixed or replaced.
- Shop contents insurance - Anything permanently fixed in your building is covered in with the building insurance. As a general rule, anything that isn't fixed down in the building needs to be included in your content’s insurance.
Optional features of shop insurance
• Legal cover – Assistance with legal fees when involved in legal action against a third party. Legal cover is not usually found as a standard policy feature but can be requested as an optional add on to your policy.
• Glass cover - An optional cover is ‘shop front’ insurance. Although the glass may be covered you still might have a sign and window decal which can be expensive to replace if damaged. Shop front insurance will cover these things.
• Loss of licence - 'Loss of licence’ insurance will cover you for the loss of income and lowering of the overall value of your business that might subsequently happen should you lose your license to sell alcohol on your premises.
• Frozen stock - For some businesses the contents of freezers can add up to thousands of pounds and should the machines fail you could potentially lose all this money. A way to protect yourself from this type of loss is to add on the optional frozen stock cover.