Dry Cleaning Insurance Policy Information
Dry Cleaning Insurance. If you own and operate a dry cleaner, then you should consider insurance to protect your business. Being the owner of a dry cleaning business means that you are exposed to lots of risks. One single lawsuit can cause you to lose everything you've worked so hard to build.
Dry cleaners use chemical applications instead of water to remove dirt, dust, and other debris from customers' clothing and other fabric items. These may include special fabrics that may be damaged by water, including leather goods and furs. Services may be provided to the general public or may be limited to commercial or institutional customers.
Depending on the type of customer and services offered, the operations may include pickup of soiled material (either from customers' premises or from owned drop-off stations), sorting, spot-cleaning (pretreatment for stains), laundering or dry-cleaning, pressing, and, delivery or return of the items to the customer. Special coatings, such as stain-proofing or waterproofing, may be applied during the cleaning process. Incidental repair work, such as sewing on buttons, may also be performed.
To protect yourself from the risks that come with operating this type of business, dry cleaning insurance is a good choice. Let's take a look at some of the different laundry service insurance policies that you can use to protect your business.
Dry cleaning insurance protects your laundry service from lawsuits with rates as low as $37/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked accounting insurance questions:
- How Much Does Dry Cleaning Insurance Cost?
- What Common Risks Do Dry Cleaners Face?
- What Type Of Insurance Do Dry Cleaners Need?
How Much Does Dry Cleaning Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small dry cleaning businesses ranges from $37 to $59 per month based on location, size, payroll, sales and experience.
What Common Risks Do Dry Cleaners Face?
Although it's important to get the best dryers and washers for your business you should also be concerned about the protection of your business. Every single day your business is faced with numerous risks. Some of these risks can cause financial damage to your business - dry cleaning insurance helps.
Running a dry cleaners and laundromat means you'll have lots of people on your premises at any given time. With more people using your services the risk of injury is a lot higher. Here are some of the risks you face while running this type of business:
- Slips and falls on wet floors
- Children playing and destroying equipment
- Theft, vandalism and other crimes
- Equipment breakdown
- Floods and other weather events that damage your business
What Type Of Insurance Do Dry Cleaners Need?
With the amount of people using your services, there's a chance of injury while on your premises. Slips and falls are the most common risks you face. Having the right dry cleaning insurance gives you the protection you need when it happens. Following are some of the most common dry cleaning insurance coverages:
Commercial General Liability Insurance: If you need protection from customer injury or property damage then this is the insurance you must have for your business. When a customer slips and falls while using your services this is the best type of dry cleaning insurance to have. When you have this type of insurance you can assist with any medical costs associated with the injury.
Business Property Insurance: With this type of insurance you protect the buildings and the machines you use for the operation of your business. Equipment such as coin-operated washers, dryers, commercial laundry machines, dry cleaning machines and other equipment owned by your business will be covered by this insurance. Whether you are renting or you own a building to operate your business you must protect it with dry cleaning insurance.
Business Interruption Insurance: With business interruption insurance you protect your store when unexpected events happen that stops business operations. Any damage done to your business can cause you to lose income. This dry cleaning insurance allows for the reimbursement of any income losses and any other business expenses because of damage to your business. It's a good idea also to expand you business interruption coverage to cover utility interruptions as well.
Equipment Breakdown Insurance: This type of insurance provides coverage for when equipment breaks down in your business. When machinery breaks down you can lose income but when you have this insurance you can be reimbursed for the income you loss. You can never predict when something like this might happen which is why you need to be prepared by having this insurance.
Workers' Compensation: Workers comp is required in most states for any non-owner employees. This insurance allows you to provide assistance to an employee if they are injured and need medical attention. If an employee gets injured and the injury leads to death then this is insurance pays benefits to the surviving family of the victim.
Dry Cleaner's Risks & Exposures
Property exposures generally include a small office, drop off and pick up storefront, dry cleaning facilities, and perhaps a warehouse for storage. Ignition sources include electrical wiring, dry cleaning equipment, heating and air conditioning systems, and water heaters.
Flammables include the textiles or other fabrics to be cleaned, scrap materials, lint from dryers, and chemicals used in dry cleaning. At one time, the chemicals used were highly flammable, but most dry cleaners now use alternative chemical applications with less exposure to fire or explosion. One chemical is generally used to pretreat stains and another to clean. The spot cleaners tend to be the most flammable. Hazards increase without proper storage and handling methods.
Fire and explosion hazard may be severe unless there are dust collection systems and procedures for regular removal and disposal of scraps. Poor housekeeping is a serious fire hazard. Sprinklers may be advisable. Unless disposed of properly, greasy, oily rags (such as those used to clean the machinery) can cause a fire without a separate ignition source. Fuels, oils, and lubricants will increase the fire hazard if vehicles are stored and maintained on the premises.
Equipment breakdown exposures include breakdown losses to the dust collection and ventilation systems, laundering and dry cleaning equipment, electrical control panels, and other apparatus. Breakdown and loss of use of the water heaters, dry cleaning, and pressing machinery could result in a significant loss, both direct and under time element.
Crime exposure includes both employee dishonesty and theft of money and securities, particularly if there are numerous cash transactions, such as at drop-off points or collections by route drivers. Lack of control over pre-employment background screening, separation of duties, and reviews of procedures used at customers' premises increases the exposure.
All retail operations should have a monitoring and verification system to reconcile bills and receipts with services rendered. Holdup potential is high, especially in retail operations. Frequent deposits should be made, especially on high volume days.
Inland marine exposure includes accounts receivable if the dry cleaner offers credit, bailees customers, computers, and valuable papers and records for customers' and suppliers' information. The bailees customers' exposure starts when the property is entrusted to a dry cleaner's employee and ends when the property is returned to the customer. The primary causes of loss are fire, theft, collision, overturn, and water damage. Hazards increase in the absence of adequate procedures, such as tagging or marking, to identify each customer's goods.
Premises liability exposure is very limited at the plant due to lack of public access. Any receiving areas should be in good condition and free from any tripping hazards. High concentrations of chemicals used in the cleaning process may be corrosive and/or toxic. Fumes, spills, or leaks may result in bodily injury or property damage to neighboring premises.
Off-site exposures are high as drivers interact with customers in the pickup and delivery operations. Personal injury exposures include assault and invasion of privacy. Failure of the cleaning service to run background checks and review references on employees both increases the hazard and reduces available defenses.
Completed operations liability exposure is low to moderate from items being damaged during the cleaning process, with the frequency being a greater concern than severity. Vapors, odors, and skin, eye, or lung irritants may result if chemicals are not properly removed from the item cleaned.
Environmental impairment liability exposure is high due to the potential for air, surface or groundwater, or soil contamination from the use and application of chemicals and detergents. The soil around the premises may be contaminated by disposal of chemicals used in the past. Disposal of perchloroethylene must adhere to EPA standards. The chemical is expensive but can be reclaimed and reused.
Workers compensation exposures can be high. Work may be performed under time constraints. Workers can experience lung, skin, or eye irritations and reactions to the dry cleaning chemicals, which may pose a long-term threat from cumulative exposure. Employees must be fully informed as to the potential effects of any chemicals, including long-term occupational disease hazards so that they can take action as quickly as possible.
Cuts and puncture wounds can result from sewing. Slips and falls can occur during cleaning at the dry cleaning facility, or at customers' premises. Back injuries while lifting or handling materials can occur, especially for employees engaged in pickup or delivery. Repetitive motion injuries can be reduced if workstations are ergonomically designed. Pets owned by customers may attack or bite workers.
Business auto exposure may be high if pickup and delivery services are provided. Deadlines placed on drivers increase the hazard. All drivers must have a valid driver's license and acceptable MVR. Vehicles must be regularly maintained and records kept at a central location. If vehicles are taken home, there should be written procedures regarding personal use by employees and their family members.
Commercial Insurance And Business Industry Classification
- SIC CODE: 7212 Garment Pressing, and Agents for Laundries and Drycleaners
- NAICS CODE: 812320 Drycleaning and Laundry Services (except Coin-Operated)
- Suggested ISO General Liability Code(s): 14732, 14733, 45678
- Suggested Workers Compensation Code(s): 2586, 2589, 8017
Description for 7212: 7212 Garment Pressing, and Agents for Laundries and Drycleaners
Division I: Services | Major Group 72: Personal Services | Industry Group 721: Laundry, Cleaning, And Garment Services
7212 Garment Pressing, and Agents for Laundries and Drycleaners: Establishments primarily engaged in providing laundry and drycleaning services but which have the laundry and drycleaning work done by others. Establishments in this industry may do their own pressing or finishing work. Establishments operating their own laundry plants are classified in Industry 7211, and those operating their own drycleaning plants are classified in Industry 7216.
- Agents, retail: for laundries and drycleaners
- Bobtailers, laundry and drycleaning
- Cleaning and laundry pickup stations not owned by laundries
- Press shops for garments
- Truck route laundry and drycleaning
- Valet apparel service
Dry Cleaning Insurance - The Bottom Line
When you are in the laundromat and dry cleaning business you face many risks. Having the right insurance for your business protects you when your business faces a lawsuit. Insurance can be the difference between losing everything in a lawsuit and keeping your business profitable..
Types Of Small Business Insurance - Requirements & Regulations
Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.
Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.
Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.
Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.
Small Business Insurance Information
In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.
The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.
Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.
According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.
Types Of Small Business Insurance
Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:
- What type of business am I running?
- What are common risks associated with this industry?
- Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
- Does my state require me to carry this type of insurance?
- Does my lender or do any of my investors require me to carry this type of policy?
A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:
|Business Insurance Policy Type||What Is Covered?|
|General Liability Insurance||What is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.|
|Workers Compensation Insurance||What is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.|
|Product Liability Insurance||What is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.|
|Commercial Property Insurance||What is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.|
|Business Owners Policy (BOP)||What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.|
|Commercial Auto Insurance||What is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.|
|Commercial Umbrella Policies||What is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.|
|Liquor Liability Insurance||What is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.|
|Professional Liability (Errors & Omissions)||What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.|
|Surety Bond||What is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).|
Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.
Business Insurance Required by Law
If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.
Your insurance agent can help you check applicable state laws so you can bring your business into compliance.
Other Types Of Small Business Insurance
There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:
- Business Interruption Insurance
- Commercial Flood Insurance
- Contractor's Insurance
- Cyber Liability
- Data Breach
- Directors and Officers
- Employment Practices Liability
- Environmental or Pollution Liability
- Management Liability
- Sexual Misconduct Liability
Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.
Additional Resources For Retail Insurance
Read valuable small business retail insurance policy information. In a retail business, you need to have the right type of commercial insurance coverage so that your store, employees, and inventory are protected.
- Adult Novelty
- Appliance & Electronics Store
- Art Gallery
- Bicycle Shop
- Book Store
- Bridal Shop
- Candy Confectionery Store
- Carpet Store
- Clothing Store
- Collectibles Memorabilia Store
- Convenience Store
- Cosmetics Store
- Dry Cleaning
- Equipment Rental
- Funeral Home
- Furniture Store
- Gift Store
- Hardware Store
- Home Improvement Store
- Hotel Motel
- Ice Cream Shop
- Jewelry Store
- Lingerie Store
- Luggage Store
- Music Store
- Office Supply Store
- Paint & Wallpaper Store
- Pet Store
- Pharmacy Liability
- Plumbing Supplies Fixtures Store
- Scrap Metal Dealers
- Sewing Store
- Shoe Store
- Sporting Goods Store
- Stationary Store
- Thrift Store
- Ticket Agency
- Tobacco Store
- Toy Store
- Travel Agency
- Wig Store
Retail stores are susceptible to premises liability claims because of customer traffic, but large department and specialty stores are more susceptible than most.
All retail stores have significant property exposures. The on-hand stock represents a considerable investment, but the amount on hand fluctuates seasonally. For this reason, physical damage insurance on this property must be arranged carefully. When the insured occupies a non-owned building, insurance coverage must be arranged for the insured's interest in extensive improvements and betterments made to the premises.
Crime insurance, in the form of employee theft and money and securities coverage, is also very important.
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 business owners policy program, the commercial package policy (CPP) is a practical and convenient way to combine a number of coverages into one policy.
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.
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 properties coverage, may mean the difference between a retail operation staying in business or being forced into bankruptcy following a loss.
When the insured occupies a non-owned building, insurance coverage must be arranged for the insured’s interest in extensive improvements and betterments made to the premises.
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.
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.
Minimum recommended small business insurance coverage: Business Personal Property, Business Income and Extra Expense, Equipment Breakdown, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Valuable Papers and Records, General Liability, Employee Benefits, Umbrella, Hired and Non-owned Auto & Workers Compensation.
Other commercial insurance policies to consider: Building, Earthquake, Flood, Leasehold Interest, Real Property Legal Liability, Computer Fraud, Forgery, Bailees Customers, Goods in Transit, Jewelers Block, Cyber Liability, Employment-related Practices, Business Auto Liability and Physical Damage and Stop Gap Liability.