In the middle of the eighteenth century, the great father of modern Economics, Scot Adam Smith declared that the future of the UK economy lay with free trade and the ability to sell and provide goods and services.
Half a century later a certain vertically challenged Corsican upstart disparagingly called us a nation of Shopkeepers. Two hundred years later to the day, shopping is essential to oil the wheels of the UK economy in our consumer society and shops are ubiquitous business enterprises.
Shops present distinct risks to an Insurer and over the years policies have developed that reflect the liability and property needs of a twenty first century retail outlet. We asked insuranceblogger to investigate what constitutes a shop insurance packaged policy.
A Guide To Shop Insurance Covers
Owning and running a shop can be hard enough work in itself, often seven days a week, without the additional worry of what might happen to your livelihood should the worst happen. Fortunately there are many different shop insurance policies available today covering all the risks that a retailer might face in running a business from a premises that sells goods and services to the public.
A shop insurance policy will contain a variety of covers, packaged up for the convenience of the shopkeeper.
These include shop buildings and contents cover, stock in trade cover, business interruption and loss of profits, money cover and staff fidelity insurance, legal protection, window & glass cover for shop fronts, goods in transit, public liability, employers liability, and various options to cover shop specific risks. Shop insurance packages will include as standard most of the above risks, whilst some insurers allow the prospective policyholder to select the covers that are appropriate for their particular type of shop.
Shop Insurers use various basic rating factors to decide premiums and postcode and annual turnover are major factors.
The location of your shop will largely determine the price you pay for cover, in particular for shop stock and contents. A shop located in a run down housing estate with known propensity for theft and vandalism will command a much higher premium than one located in a modern shopping centre with street security and CCTV. Annual turnover is used to calculate cover levels such as the impact of a loss on a shops ability to trade.
Shop buildings insurance covers the costs of rebuilding the shop and the costs of replacing the shop front, which is invariably made of glass. All buildings insurance covers permanent fixtures and fittings such as toilets and doors. This cover is available for both shop owners and those who lease the property.
Shop contents insurance covers all the additional shop fittings and equipment that is used in the daily running of the business. Most insurance companies will require a breakdown of the contents of the shop into sums insured fo business equipment, fixtures and fittings, electrical and computer equipment, tenants improvements, refrigerated stock and all other stock.
Shops that require protection for high risk goods held on the premises will usually need to declare the total values of each stock item. High risk shop stock and goods are those that attract thieves and are expensive to replace. Examples of high risk stock items are electronic equipment, cigarettes, and tobacco, designer clothing, computers and digital equipment, software, computer games and consoles, drugs pharmacy and medicines, watches and jewellery, mobile phones and radios, photographic equipment, power tools, TVs, DVDs, CDs and Wines and Spirits.
If your shop has high risk stock you can reduce the cost of your premiums by having adequate security in place. This includes an insurance company approved burglar and fire alarm, window grills, shutters and bars, CCTV and sprinklers. Many shop insurers will only offer stock cover if the minimum levels of security are in place for all shops, regardless of the stock contents held. A lot of insurers may offer further large discounts to the premium if the shop owner lives on or above the premises and is there at night.
Shops by their very nature deal with members of the public and a good insurance policy will usually contain liability cover as standard. This should include Public Liability of up to £2,000,000 for any one claim by a member of the public who may suffer loss or injury visiting the shop.
If you employ staff all policies will offer Employers Liability cover of up to £10,000,000 one event and because shops sell goods and services, Products Liability cover of £2,000,000 for any one period of insurance.
Other standard features of a shop insurance policy are various levels of cover for Legal expenses and Legal protection, Employers, Public and Products Liability, Loss of profits, Glass and Sanitary Ware, Money cover and staff Personal Accident assault, Business Interruption, Goods in Transit, Loss of Licence, Treatment Risks and Seasonal increases in stock contents value.
Shop Insurance is available to buy online from a variety of mainstream and independent suppliers, many of who offer policies for specialist niche shops and retail outlets. Shopping around for cover is easy and many brokers now offer shop insurance comparsion systems where you can compare shop insurance quotes and covers online.
Ensure you read the keyfacts documents of any policies offered, so you are aware of the levels of cover offered before you buy.