Department Store Insurance: Cost & Quotes From $11/mo

A department store is a business that costs thousands of dollars. The problem is, a lot of problems can easily make this retail venture go down the drain. 

The food sold in the grocery section of your department store can spoil and inflict food borne illnesses to customers. A small fire can start in the electronics section and result in a devastating loss. Theft and vandalism can also happen in your department store’s fashion shop. 

Department store insurance covers such risks. In this guide, you will know what policies are included, how much premiums cost, and which insurance companies provide the best coverage.

Department Store Liability Insurance

Liability coverage allows your department store to face lawsuits without any worries or fears. General liability and product liability are the two types of department store liability insurance. Let’s see how each works.

General Liability Insurance for Department Stores

General liability insurance grants protection if your department store faces a claim for bodily injuries, property damage, slander, copyright infringement, and libel. This insurance is a primary inclusion in almost all department store insurance bundles.

Have this insurance and you can easily grant compensation for medical treatment, reimbursement for property damage, pay legal defense costs, and cover court judgments. Use the table above to see which insurance company offers the best general liability insurance for department stores.

What Are Some Examples of Unfortunate Events in Your Department Store That General Liability Insurance Can Cover?

Unfortunate events in your department store that general liability insurance can cover are as follows:

• Slip and fall accidents

• A customer getting hit by a trolley or any other equipment that your employee is using

• The occurrence of a stampede due to a false fire alarm, a person brandishing a weapon, or any other incident that will entice the public to panic

• Customers getting hit by falling merchandise from shelves

• A customer sustaining injuries while testing the chair or tool sold at your department store

• Your department store facing a copyright infringement claim after misusing the trademark of a brand in an advertising campaign

Can General Liability Insurance Help if My Department Store Becomes the Target of Terrorist Attacks?

Yes. Insurance companies allow you to add terrorism coverage to general liability insurance. You can use this to cover the medical treatment of customers and reimburse their damaged properties in case of a suicide bombing, hostage-taking, and other types of terrorist attacks.

Product Liability Insurance for Department Stores

Customers can file a claim if they sustain injuries or property damage due to products bought from your department store. This will cost a lot to sort out, and product liability insurance can help.

Product liability insurance is automatically included in general liability insurance. This grants a $1 million-$2 million coverage you can use to cover compensation, legal defense, court judgments, and product recall expenses.

The coverage of product liability insurance applies when a client accuses your department store of selling:

• Substandard products

• Products with labeling errors

• Products with erroneous or inadequate user manual

• Products with manufacturing defects

Commercial Property Insurance for Department Stores

Building a department store or having an existing building renovated into one takes a lot of money. Damage or destruction will mean utter devastation and significant losses. Nonetheless, insurance companies give you the chance to recover through commercial property insurance. Use the table above to see which company offers this type of department store insurance policy best.

How Does Commercial Property Insurance Safeguard Your Department Store?

Commercial property insurance will reimburse financial losses if your department store’s building, stocks, and inventory is damaged or destroyed by

• Fire

• Theft

• Vandalism

• Riot

• Civil commotion

• Sinkhole collapse

• Volcanic action

• Lightning

• Weather

• Impact

• Falling objects

• Aircraft

• Vehicle

• Sprinkler leakage

Is It Possible to Broaden the Coverage of Commercial Property Insurance to Cover the Specialized Risks of My Department Store?

Yes. You can broaden the coverage of your department store’s commercial property insurance by getting these endorsements:

• Spoilage–If you specialize in highly perishable goods, you must store these products in a controlled environment to prevent them from spoiling. You can add spoilage insurance to cover any financial losses you might suffer due to a failure in the temperature control system caused by situations you can't control

• Mechanical failure–This endorsement covers repair or replacement expenses if a refrigerator, power generator, HVAC, forklift, trolleys, conveyors, and other equipment breaks down due to operator error, upset, and other covered perils

• Food contamination–There are high risks that the food may get contaminated due to mishandling, equipment breakdown, or vermin. Food contamination insurance covers the cost of a product recall, customer medical treatment, and cleanup

Business Owner’s Policy for Department Stores

A business owner’s policy (BOP) is the most cost-effective and efficient way to insure your department store. This usually bundles general liability coverage and commercial property coverage.

As a result, insurers generally sell BOPs at a lower rate than if you were to purchase each policy separately. Besides, it's a flexible plan as policyholders can customize their policies through additional options to fit the specific needs of their department store. Use the table above to see which insurance company offers the best business owner’s policy for department stores.

Workers Compensation Insurance for Department Stores

Your department store can’t run without employees. You’ll need clerks, cashiers, maintenance technicians, inspectors, and so on.

Authorities will require you to purchase workers' compensation insurance to safeguard employees against slip and fall accidents, exposure to harmful chemicals, and other work-related accidents.

When an employee sustains an injury or illness because of the tasks in your department store, workers' compensation insurance covers the costs for emergency medical care, hospitalization, medication, rehabilitation, and lost wages. And in case of death, this insurance will cover funeral expenses and sustain the family of your deceased employee.

Commercial Auto Insurance for Department Stores

Commercial auto insurance is a coverage for the box trucks, cargo vans, tractor-trailers, and other vehicles owned by your department store. This policy acts as a first line of defense in case something happens while your commercial vehicles are hauling cargo or delivering supplies. Commercial auto insurance functions to:

• Cover liability for accidents caused by your department store’s box truck, cargo van, or any other commercial vehicle

• Shoulder the repair or replacement of parts if your department store’s commercial vehicle sustains damage due to fire, lightning, theft, vandalism, weather, and other covered perils

• Pay the medical treatment of the driver and passengers if ever your commercial vehicle gets involved in an accident caused by an uninsured/underinsured motorist

Other Insurance Policies to Include in Your Insurance Package

The policies above are the most common inclusion in the tailored insurance bundle for department stores. But note that these additional policies are also available, depending on your risk level and choice of insurance company:

• Umbrella liability insurance-Umbrella liability insurance supplements the limits of your general liability policy in case it can’t provide adequate coverage because the claim is too costly or the policy limits have been exhausted

• Business interruption insurance-Business interruption insurance covers the operational costs you’ll have to shoulder in case your department store’s operation is halted by a fire, renovation, relocation, or economic crisis

• Employee dishonesty insurance-Employee dishonesty insurance will reimburse the money you lost after an employee or a group of employees commit theft, embezzlement, social engineering, credit card fraud, unauthorized transactions, and other dishonest acts

• Employment practices liability insurance-Employment practices liability insurance will cover legal defense costs, settlements, and court judgments if an employee sues for sexual harassment, retaliation, negligent hiring, failure to promote, discrimination, wrongful termination, and other violation of employee rights

• Cargo insurance-Cargo insurance reimburses the value of incoming stocks that got damaged or destroyed due to theft, vandalism, and other covered perils while in transit

• Cyber liability insurance-Cyber liability insurance will cover the cost for data breach containment, customer notification, legal defense, and credit and fraud monitoring if your department store becomes a victim of a cyberattack

Department Store Insurance Cost

The average department store insurance cost is $40 per month or $480 per year for a $1 million general liability policy. Your premiums can be exactly the same or different based on the following factors:

• Your department store's size

• Inventory levels

• Your store's specialty

• Number of employees

• The store's location

• Policy limits

• Deductible level

Here’s another table that shows the cost of a $1 million general liability insurance from highly rated carriers: