last posts

Shop Insurance Explained - iExpats


Store insurance is an important safeguard, but outlet owners need to know that they have adequately covered as many risks as possible.

Store insurance is a specialized cover designed to meet the needs of points of sale by protecting certain vital aspects of the business, such as:

  • Customers
  • Personal
  • Premises and stock
  • Revenue

Store insurance combines four types of coverage – liability, employer’s liability, contents and business interruption – to provide this comprehensive protection.

Who needs store insurance?

Shop insurance is for any retail business operating from commercial premises.

If you own a store and rent the premises to a business, you may need building insurance, but the store owner is responsible for the rest of the coverage.

Entrepreneurs running an online business or a pop-up business from home should investigate the coverage provided by a national commercial policy.

What does Shop Insurance do?

Store insurance is not a type of insurance but a generic term designating a set of protections intended for merchants.

Being sheltered under the umbrella means that store insurance has a single renewal date and a simplified application process, which can reduce costs.

Now let’s take a closer look at the four main types of store insurance:

Liability insurance

Busy stores have many customers and the risk of an incident involving injury inside the store increases as the business becomes busier.

Store liability insurance protects the business against claims from customers or other visitors to the premises, such as delivery people or contractors.

In addition to compensation, civil liability also covers damage caused to the property of others, legal costs and expenses related to the claim, such as expert witnesses or medical expenses.

Employer liability insurance

Employer’s liability insurance does more or less the same thing as liability cover with one main difference: the policy covers staff compensation claims.

The term staff covers a wide range – from paid workers to volunteers or interns working for free.

However, if you are the sole officer of a corporation that operates your business, or if you only work with close relatives, you may not need employer liability coverage.

Store insurance for premises and stock

If you have high-value inventory, such as wine, spirits, tobacco, or jewelry, you’re a target for walk-in thieves trying their luck or more determined burglars.

Stock insurance protects the items you need to sell to profit from accidental damage, such as fire, flood, theft, and other perils.

If you rent a store, the owner is responsible for insuring the premises; otherwise, you will need building insurance. If you are buying a store with a mortgage, the lender will likely want you to take out building coverage as part of the terms of the loan.

Work interruption

One of the most overlooked but vital store insurance is business interruption coverage.

The policy pays when the business cannot open due to a serious incident, such as a fire, flood or cyberattack. The policy usually covers the additional costs due to the incident and the loss of income.

Other store insurance to consider

Depending on your type of store, you may want to consider one or more additional store insurance policies.

  • Product Liability – This is often sold with liability and covers any loss or injury to anyone outside the company due to the use of a faulty product
  • Legal expense cover – this is usually not part of a basic insurance policy, but a top-up at an additional cost.
  • Glass Cover – insures the storefront, including signage and window stickers, against damage, but may already be part of the homeowner’s insurance.
  • Loss of liquor license – If you sell beer, wine and spirits, this protects you against losing your license and the consequent loss of revenue
  • Loss of frozen stock – If a large part of your business is selling frozen food, lost stock can cost thousands of dollars, so it’s worth considering this additional coverage
  • Professional Indemnity – This add-on covers against bad advice given to customers or damage to items being repaired, for example.
  • Cybercrime – It pays if your online business is hacked or locked into a denial of service
  • Equipment Coverage – This kicks in if equipment, such as tools or computers, is damaged or stolen so your business can be up and running quickly after an incident.
  • Goods in Transit – If you deliver goods to customers, Goods in Transit coverage protects the items against loss or damage while they are on the road

Is store insurance compulsory?

The only compulsory professional insurance for stores is employers’ civil liability.

Yet any shop faced with a claim without a policy must find the money to fund the reward, which can often run into the tens of thousands of pounds and bankrupt the business.

Do I need store insurance?

If you answer yes to any of the following questions, you should consider purchasing store insurance:

  • Do you keep inventory for sale?
  • Do you repair goods for customers?
  • Do customers visit your store?
  • Do you see clients at home or at work?
  • Do you keep cash in a store?

How much does store insurance cost?

Quoting store insurance is complicated because no two companies are the same. Even similar businesses reading side by side have different insurance needs due to the value of inventory, the number of employees, or the amount of money going through the tills.

Insurers will tailor store insurance to the needs of your business. According to industry research, the starting price for store insurance is around £400 per year. This award offers £2 million for third party liability, employers’ liability insurance and cover for contents and stock worth £50,000.


Do I need shop insurance for an online shop at home?

You should insure stock and business equipment and consider liability and employer liability cover, but you’ll need specialist home cover rather than shop insurance.

I run a cafe, is it a store?

Retail outlets come in many shapes, types and sizes, but they all have in common the need for personalized insurance. If customers come to your store, buy goods or services, and spend money, you need store insurance.

What are the package policies?

Flat-rate policies are specialized insurance packages designed to cater to a specific type of business. For example, a store package might offer extra stock coverage at Christmas to meet a toy store’s busiest time.

Does my business need product liability coverage?

If your business sells goods made by other businesses, you shouldn’t need product liability coverage. The policy is designed for companies that design, create and sell their own products.

Do I need personal accident insurance?

This addition replaces income to help pay bills for employees who cannot work due to an accident on or off the job.

Below is a list of related articles that may be of interest to you.



Font Size
lines height