Hardware Store Insurance Policy Information
Hardware Store Insurance. Hardware stores sell a variety of merchandise for professional or do-it-yourself maintenance and repair projects for homeowners, renters, handymen, and contractors.
Products offered include tools, building materials and supplies, lumber, plumbing, heating, air conditioning and electrical fixtures. Some also sell sporting goods, bicycles, gardening supplies, lawnmowers, prepackaged fertilizers, insecticides, pesticides, outdoor furniture, plants, clothing, toys, and automotive supplies.
Some operations fill and refill LP gas for campers and grills or provide a pickup and drop-off point for an LP gas dealer. Many hardware stores provide for the rental of various types of equipment from carpet cleaners to yard and garden machinery, to chainsaws or other equipment.
Most hardware stores offer repair services for the items they carry. Some offer window glass and screen replacement services if the customer brings the frame to the store. Delivery and contracting services for interior design, painting, wallpapering, flooring installation, or other building projects may be available, either through their own employees or through independent contractors.
As the owner of a hardware store, you offer your customers and your community a necessary service. But are you also considering the liabilities you face - the same liabilities that all business owners face in today's economy?
We live in an increasingly litigious society; there is a subsect of people who are continually on the lookout for reasons to be offended or to claim injury or damage.
And there are also many real perils involved in business operation that can cause injury or damage to those that you deal with on a daily basis. For these reasons, it is important to purchase the right level of hardware store insurance for your business.
Hardware store insurance protects your shop 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 hardware store insurance questions:
- What Is Hardware Store Insurance?
- How Much Does Hardware Store Insurance Cost?
- Why Do Hardware Stores Need Insurance?
- What Type Of Liability Insurance Hardware Stores Need?
- What Type Of Property Insurance Hardware Stores Need?
- What Does Hardware Store Insurance Cover & Pay For?
What Is Hardware Store Insurance?
Hardware store insurance is a type of insurance coverage that is specifically designed for hardware stores. It provides protection against financial losses that could result from accidents, theft, natural disasters, and other covered events.
This insurance coverage typically includes general liability insurance, property insurance, inventory insurance, and business interruption insurance. It may also include protection against employee theft and errors and omissions insurance.
The specific types of coverage and the limits of coverage vary depending on the policy, but the overall goal is to help protect the hardware store from financial losses and keep it in business in the event of a covered event.
How Much Does Hardware Store Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small hardware stores ranges from $37 to $59 per month based on location, size, payroll, sales and experience.
Why Do Hardware Stores Need Insurance?
As of 2014, there are around 16,000 hardware stores doing business in the U.S., providing jobs for upwards of 140,000 people. The hardware store industry accounts for around $24 billion each year in revenue. As you can see, this lucrative business leaves lots of room for potential liabilities that can cripple your business and leave you reeling financially.
Although any hardware store seems like a pretty innocuous place, the truth is that perils lurk around every corner. Some of these potential mishaps can really threaten your hardware store's finances and leave you in a bad position. For instance:
- A customer may slip and fall on a freshly mopped floor, becoming injured when they collide with the sharp edges of shelving, fixtures, or other items.
- Costly computer equipment may become inoperable because of a power surge or operator error.
- Your employee may cause a serious automobile accident while out making a delivery, and you'd be left on the hook for any damages arising as a result.
These are just a few of the examples of potential problems that could result in liability or damage claims against you. Discussing your potential hazards with a licensed agent makes senses. Your agent can review your individual risks and risk tolerance to determine which types of liability and property policies as well as other hardware store insurance your hardware store may need.
What Type Of Liability Insurance Hardware Stores Need?
A main component of any hardware store insurance policy is commercial general liability coverage. This is a type of coverage that provides coverage for legal defense costs and any financial awards associated with bodily injury claims or property damage claims against your business.
A common claim is 'slip and fall'. In addition, if your business is sued because of selling a product that causes property damage or bodily injury, this policy also usually offers product liability coverage.
Although a general liability policy is quite sufficient for some businesses, it does not cover all potential events that may lead to claims. You may need to buy some supplemental coverage types along with your hardware store insurance insurance. Some to consider:
Pollution Liability Coverage: If your store sells a lot of chemicals, including fertilizers and other chemicals, you may need to look into pollution liability coverage.
Commercial Auto: Protect your company-owned vehicles with commercial auto coverage.
Hired and Non Owned Autos: If you rent trucks or if employees use personal autos in the course of doing business for you, this policy provides protection against any liabilities, damages, and injuries that may result.
Additional Policy Types
Beyond the purchase of property and liability policies, you may want to discuss your need for the following additional policy types with your agent. These include:
Worker's Compensation - Workers comp is required in most states by law for any non-owner or partner employees. workers comp pays lost wages and medical costs when an employee becomes injured or ill due to a work-related peril.
Business Income - If you experience a business stoppage due to a covered peril, then this hardware store insurance provides income while you rebuild, move, or otherwise get your business up and running again.
Employment Practices Liability Insurance (EPLI) - Avoid the damage when someone claims you were unfair in your employment practices with this coverage.
What Type Of Property Insurance Hardware Stores Need?
A commercial insurance policy is a necessary purchase for all hardware store owners. This hardware store insurance policy is typically sufficient to provide the full coverage your store needs for its inventory and all of your equipment, including your computers, fixtures, shelving, cash registers, and more.
Because inventory changes over time, it is invariably a good idea to sit down with an agent and review your existing coverage every few years to make sure you are still protected to the fullest.
Chances are good that your hardware store owns several pieces of expensive machinery such as paint shakers and key-cutting equipment. For this reason, protecting that valuable property with a supplemental hardware store insurance policy known as equipment breakdown insurance makes sense.
This type of coverage, sometimes referred to by the name "boiler and machinery coverage" can compensate you for any breakdown in this equipment. Air conditioning, fuse boxes, and other types of mechanical equipment in the store can be covered by this policy as well.
It may even compensate you for the income you lose if this machinery is on the fritz and being repaired.
Bear in mind that almost all hardware store insurance policies have an exclusion for flood damage. If your business lies in a flood-prone region, look into a supplement for commercial flood insurance.
Hardware Store's Risks & Exposures
Premises liability exposure comes from slips and falls due to public access to the premises. Aisles must be adequate and free of debris. Flooring must be in good condition with no frayed or worn spots on carpet and no cracks or holes in flooring. Steps and uneven floor surfaces should be prominently marked. Sufficient exits must be provided and be well marked with backup lighting systems in case of power failure. All goods should be kept on easily reached shelves so that customers do not pull down items on themselves.
Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls. If the business is open after dark, there should be adequate lighting and appropriate security for the area.
If employees make deliveries or install purchases for customers, there could be a property damage exposure to the customers' premises. If the store recommends independent contractors, certificates of insurance should be maintained to verify that the contractors carry adequate limits of liability.
Products liability exposure is normally low unless there is direct import of products or assembly and repair of equipment and bicycles. Foreign-made items should come from a domestic-based wholesaler. Any direct importer should be considered as a product manufacturer.
Environmental impairment exposure comes from the mixture of paints, disposal of insecticides or pesticides, and any potential for used oil, degreasers, solvents, and batteries. All disposal must meet EPA standards.
Workers compensation exposure is from lifting that can cause back injury, hernias, sprains, and strains, and also from slips and falls. Employees should be provided with safety equipment, trained on proper handling techniques, and have conveying devices available to assist with heavy lifting. Housekeeping in storage areas, especially during peak times, is vital in preventing trips and falls.
If employees are involved in processing, repair work or lumberyard operations, there is the exposure to cuts, puncture wounds, burns and eye injuries. Safety measures such as goggles must be in place. In any retail business, hold-ups are possible so employees should be trained to respond in a prescribed manner. Drivers of delivery trucks can be injured in accidents. Installers can suffer knee and foot injuries, and eye, skin and lung irritations from exposure to adhesives and other chemicals.
Property exposures can be high due to large amounts of combustible materials and the operations performed on premises, which can include repair services and LP gas filling, refilling, or storage. All flammables must be properly stored, separated, and controlled. If the store sells ammunition or loads black powder, the exposure increases significantly. Proper controls must be in place.
The electrical load may be heavy if electrical lighting, equipment and machinery is sold due to floor models being plugged into numerous outlets for customers to try out prior to purchase. Wiring must be up to date and meet current codes. There should be no smoking on premises.
If there are high-value or target items such as bicycles, sporting equipment, guns, ammunition and machinery, theft may be a concern. Appropriate security measures must be taken including physical barriers to prevent entrance to the premises after hours and an alarm system that reports directly to a central station or the police department.
Crime exposures are from employee dishonesty and loss of money and securities either from holdup or safe burglary. Background checks should be conducted on all employees handling money. There must be separation of duties between persons handling deposits and disbursements and handling bank statements. Money should be regularly collected from cash drawers and moved away from the collection area, preferably to a safe on premises. Bank drops should be made throughout the day to prevent a buildup of cash on the premises.
Inland marine exposures are from accounts receivable if the store offers credit, computers to transact sales and monitor inventory, equipment floater if forklifts are used in the warehouse, goods in transit if deliveries are made, and valuable papers and records due to customers' and vendors' records. Backup copies of all records, including computer records, should be made and stored off premises.
Commercial auto exposure can be high if delivery services are provided. Drivers should have a valid license and acceptable MVR and be trained in handling unwieldy loads that may shift during transport. Vehicles must be regularly maintained with full documentation kept.
What Does Hardware Store Insurance Cover & Pay For?
Hardware stores may face various lawsuits due to a range of reasons. Some common reasons include:
Slip and fall accidents: Customers may slip and fall in the store due to wet or slippery floors, uneven surfaces, or debris on the floor. A hardware store can purchase general liability insurance, which typically covers bodily injury and property damage caused by the store's operations. If a customer slips and falls in the store and sues the store for medical expenses, lost wages, and pain and suffering, the store's general liability insurance may cover those costs.
Product liability: Hardware stores may sell products that are defective or dangerous, causing injury or property damage to the customer. Hardware stores can purchase product liability insurance, which covers claims arising from the sale of products that cause injury or damage. If a customer sues the store for selling a defective tool that caused injury or property damage, the store's product liability insurance may cover the cost of the lawsuit.
Negligent employee behavior: If an employee of the hardware store behaves negligently, such as by improperly using equipment or causing damage to customer property, the store may be held liable. Hardware stores can purchase employment practices liability insurance, which covers claims arising from employee conduct. If an employee of the hardware store causes damage to customer property, the store's employment practices liability insurance may cover the cost of the lawsuit.
Property damage: If the hardware store's property, such as the building or inventory, is damaged, the store may face a lawsuit. Hardware stores can purchase property insurance, which covers damage to the store's building, inventory, and other assets. If the store's property is damaged due to an accident or natural disaster, the store's property insurance may cover the cost of repairs or replacement.
Overall, insurance can provide hardware stores with financial protection against a variety of lawsuits, allowing them to focus on running their business without worrying about the potential costs of legal disputes.
Commercial Insurance And Business Industry Classification
- SIC CODE: 5251 Hardware Stores - Retail
- NAICS CODE: 444130 Hardware Stores
- Suggested Workers Compensation Code(s): 8010 Store - Hardware
5251: Hardware Stores
Division G: Retail Trade | Major Group 52: Building Materials, Hardware, Garden Supply, And Mobile Home Dealers | Industry Group 525: Hardware Stores
5251 Hardware Stores: Establishments primarily engaged in the retail sale of a number of basic hardware lines, such as tools, builders'hardware, paint and glass, housewares and household appliances, and cutlery.
- Builders' hardware-retail
- Door locks and lock sets-retail
- Hardware stores-retail
- Tools, power and hand-retail
Hardware Store Insurance - The Bottom Line
These are just a few of the types of coverage you may need. Talk to your agent to get a full picture of the needs you have and how to best meet those needs when devising the right hardware store insurance package for your store.
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
- Antique Dealers
- Appliance & Electronics Store
- Army Navy Surplus Stores
- Art Dealers
- Art Gallery
- Arts & Crafts Supply Stores
- Bicycle Shop
- Boat Dealers
- Book Store
- Bridal Shop
- Candy Confectionery Store
- Carpet Store
- Cell Phone Stores
- Clothing Store
- Collectibles Memorabilia Store
- Consignment Stores
- Convenience Store
- Cosmetics Store
- Costume Stores
- Dry Cleaning
- Embroidery Services
- Equipment Rental
- Fabric Stores
- Fish Markets
- Flea Markets
- Funeral Home
- Furniture Store
- Gift Store
- Greeting Card Stores
- Hardware Store
- Harness & Saddle Shops
- Home Improvement Store
- Infant, Baby & Children's Clothing Stores
- Jewelry Store
- Lamp Stores
- Lingerie Store
- Luggage Store
- Meat Market & Butcher Shop
- Men's Clothing Stores
- Music Store
- Office Supply Store
- Paint & Wallpaper Store
- Pawn Shop
- Pet Store
- Pharmacy Liability
- Plumbing Supplies Fixtures Store
- Poultry Dealers
- Rent To Own Stores
- Scrap Metal Dealers
- Sewing Store
- Shoe Store
- Sporting Goods Store
- Stationary Store
- Thrift Store
- Ticket Agency
- Tire Store
- Tobacco Store
- Toy Store
- Travel Agency
- Trophy Stores
- Tuxedo And Formal Wear Rental Store
- Vending Machine Operators
- Wig Store
- Women's Clothing Stores
- Specialty Retail Stores
The retail industry is a vital sector of the economy, providing goods and services to consumers across the globe. It is also a sector that is constantly evolving, with new technologies and trends emerging on a regular basis.
Despite its importance, the retail industry is not without its risks. Retail businesses face a variety of threats, including theft, damage to property, and liability issues. These risks can have significant financial consequences for retail businesses, which is why commercial insurance is so important.
Insurance can provide retailers with protection against financial loss resulting from unforeseen events. For example, if a retail store is damaged by a natural disaster, insurance can help cover the cost of repairs and help the business get back on its feet. Similarly, if a retail employee is injured on the job, insurance can help cover their medical expenses and any lost wages.
In addition to protecting against financial loss, commercial insurance can also help retail businesses protect their reputation. If a retail business is sued or faces other legal challenges, insurance can provide financial support and legal representation. This can help to protect the business's reputation and maintain customer trust.
Overall, insurance is an essential component of a successful retail business. It helps to safeguard against financial loss and protect against potential legal challenges, which can be especially important for smaller businesses that may not have the resources to absorb these types of losses.
By investing in business insurance, retail businesses can ensure that they are well-equipped to handle the many challenges that come with operating in this dynamic industry.
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.