If you are thinking of opening up your place of work to the public, whereby you are displaying your goods for the purposes of retail, then you need shop insurance.
As well as the standard cover that Employers and Public Liability Insurance provides, you also need to protect your stock and premises – if you were to lose either, it would be disastrous for the business into which you have ploughed your time, effort and capital if you weren’t easily able to replace anything lost in this manner.
As there is so much to consider when opting for such a policy, there being so many variations of type of shop that you may be considering opening, it is imperative to ensure that whoever you choose to cover you, actually does.
Many providers will provide a list of basic items that are must haves for any retail outlet in the event of unforeseen circumstances.
This list of essentials will normally always include protection against some, or all, of the following: accidental loss or damage (incl. theft), malicious damage or riot, fire, lightning, explosion, burst water pipes (underground areas may not be covered by your buildings policy), storms and floods, window-frame and glass replacement and lock replacement following theft.
Add-ons that you may want to consider would be freezer cover, stock in transit, removal of debris, ‘attractive commodities’ if you are selling tools, spirits and tobacco. These add-ons can be decided by using a calculation of the value of the stock to cover versus the likelihood of you needing that aspect against the cost of addition of these extra clauses. Be wary of taking out policies for services that your business is unlikely to utilise.
Another extra you should consider, as well as protection against the tangible goods that can be replaced from a warehouse or distribution outlet, is protection against your livelihood.
Most insurance firms will offer you insurance against interruptions to your business in the event that you have to make a claim against any of the afore-mentioned circumstances. The fact that you may have a warehouse full of undamaged stock is of little use if your premises are unsafe for the public or provide an unfit environment for your staff.
Business interruption cover is a basic shop policy extension, which provides cover for loss of income due to inability to trade in the event of any claim under your Shop Buildings and Contents policy, including additional expenses necessary to keep your shop in business whilst repairs are carried out.
One last point – most policies are index-linked. If the value of your goods insured was valued at £500 when you bought them, but you know their nett value has risen, be sure to press home this fact when making a claim. This is a double-edged sword. If the value of that commodity has depreciated, you are unlikely to get back the sum originally insured.