Retail Stores Insurance FAQ

• At the minimum, retail stores need general liability insurance.
• If they have employees they will need workers compensation in most states.
• If they have vehicles registered to the business, or use vehicles for the business purposes, they will also need commercial auto.
• There are also other specialty coverages and endorsements that might be needed based on their operations.

The businessowners policy was designed with retail exposures and operations in mind. For this reason alone, it should always be the first type of package coverage to consider. However, for those risks not eligible for the businessowners program, the commercial package policy (CPP) is a practical and convenient way to combine a number of coverages into one policy.

Types Of Retail Stores Package Policies:

• Businessowners Policy (BOP)
• Commercial Package Policy (CPP)

Inventory or stock is the major property exposure for most retail operations. Because stock values tend to fluctuate or have significant peaks at certain times of the year, value reporting or peak season valuation options should be considered.

Business income coverage, including business income from dependent and secondary dependent properties coverage, may mean the difference between a retail operation staying in business or being forced into bankruptcy following a loss.

Types Of Property Coverages:

• Building
• Business Personal Property
• Personal Property of Others
• Improvements and Betterments

Inland marine coverage options should be carefully considered when evaluating the insurance needs for a particular retail business. A business personal property inventory should be prepared to uncover gaps that can be filled only with one or more of the following:

Types Of Inland Marine Coverages:

• Accounts Receivable Coverage
• Bailee Customers Coverage
• Camera and Musical Instrument Dealers Coverage
• Commercial Articles Floaters
• Contractors' Equipment Coverage
• Difference in Conditions (DIC) Coverage
• Electronic Data Processing Equipment Coverage
• Equipment Dealers Coverage
• Fine Arts Coverage
• Fine Arts Dealers Coverage
• Floor Plan Coverage
• Furriers Block Policy
• Furriers Customers Coverage
• Furriers Customers Excess Legal Liability Coverage
• Goods In Transit
• Installation Coverage
• Installment Sales Coverage
• Jewelers Block Policy
• Processing Risk Coverage
• Scheduled Property Coverage
• Signs Coverage
• Transportation Coverage
• Valuable Papers and Records Coverage

Most retail businesses offer endless opportunities for a variety of criminal activities. For this reason, the coverages needed must be carefully evaluated.

Holdup and robbery losses may be the most obvious concerns but employee theft, fraud and counterfeit money losses are also serious issues that cannot be dismissed. Finally, high-end retail businesses may be targets for extortionists or kidnap and ransom capers.

Fraudulent Impersonation coverage is a newly introduced coverage that can aid for loss due to trickery.

Other coverages that may be needed are determined by money-handling arrangements, the nature and extent of computer transactions and functions, and whether or not the business is considered a target. Fraudulent impersonation coverage could be very helpful to certain service operations because it covers loss through trickery.

Types Of Crime Coverages:

• Computer and Funds Transfer Fraud Coverage
• Employee Theft Coverage
• Forgery or Alteration Coverage
• Inside The Premises-Theft of Money and Securities Coverage
• Inside The Premises-Robbery or Safe Burglary of Other Property Coverage
• Money Orders and Counterfeit Money Coverage
• Outside The Premises Coverage

Retailers may need surety bonds because of types of contracts they make and/or the licenses and permits required of them to operate at their particular location. Bonds will be required to guarantee that the business will keep its promise and conduct operations in the prescribed manner.

Types Of Surety Coverages:

• Contract-Performance of Service or Supply Bonds
• Court Bonds
• Fiduciary Bonds
• License and Permit Bonds
• Miscellaneous Surety Bonds

Retail businesses generate income through interaction with customers. This interaction is also how a customer can sustain an injury and then sue the retailer for damages.

Hazards, exposures and operations both on premises and off are important and must be covered, but liability the retailer may incur because of the merchandise sold must also be considered and insurance protection arranged.

Types Of Liability Coverages:

• Commercial General Liability (CGL) Coverage
• Employee Benefits Liability Coverage
• Employment-Related Practices Coverage
• Owners and Contractors Protective (OCP) Liability Coverage
• Special Events Liability Coverage

The automobile exposures of a retail business may be limited to hired and non-owned automobiles only. On the other hand, they can be extensive if the retailer picks up or delivers merchandise. Garagekeepers coverage may be necessary if valet parking is provided.

Types Of Business Auto Coverages:

• Auto Medical Payments
• Business Auto Coverage
• Collision Coverage
• Comprehensive Coverage
• Garagekeepers Coverage
• Hired & Non-owned Auto Coverage (HNOA)
• Uninsured/Underinsured Motorists Coverage

Injuries to employees as a result of attempted or actual holdups or robberies are a concern, but other day-to-day activities like lifting, slips and falls can also cause serious injuries and must also be considered. Workers compensation provides the coverage for the employee injuries.

Types Of Workers Comp Coverages:

• Stop-Gap or Employers Liability Coverage
• Workers Compensation and Employers Liability Coverage

Professional liability coverage should be included with the other underlying general liability, automobile liability and employers liability coverages under an excess or umbrella liability policy whenever possible.

All underlying exposures, hazards and operations must be evaluated thoroughly and carefully to determine the liability limits needed to adequately protect the financial assets of the insured.

Types Of Excess Liability Coverages:

• Excess Liability Coverage
• Umbrella Coverage

Retail businesses are gaining greater exposure to international issues because of the growth in sales via the internet. As these sales increase, the added exposures faced by these retailers must be evaluated. While their operating horizons are expanding so are their potential loss exposures. One of the following coverages may cover some of those growing coverage gaps.

Types Of Specialty Coverages:

• American Expatriate Coverage
• Business Legal Expense Coverage
• Cyber Liability Coverage
• Data Security Breach Coverage
• Directors and Officers Liability Coverage
• Electronic Data Liability
• Environmental Impairment Liability Coverage
• Export Credit Insurance Coverage
• Fiduciary Liability (Pension, Welfare and Employee Benefit Funds) Coverage
• Identity Theft Insurance Coverage
• International Insurance Coverage
• Risk Retention Group Liability Coverage
• Solar Energy System Coverage
• Tax Liability Coverage
• Tender Offer Defense Expense Coverage
• Terrorism Insurance Coverage
• Unmanned Aerial Vehicles (UAV) (Drones)
• Weather Coverage