Ever since the world’s first laundry machines were invented in the early-1800s, laundry businesses have provided laundry washing, folding, and delivery service to customers. Around the same time, dry cleaning also became a popular way to clean high-end fabrics that could be damaged by the vigorous motion of a washing machine or pressure washing machines.
Despite the fact that many modern households have laundry machines and dryers, the laundry industry is still alive and well. People and families who don’t have time to wash their own laundry (let alone fold it, iron it, or dry clean it) still frequent launderettes and use various other laundry services to save time and energy.
Suppose you’re just starting your laundromat, dry cleaning, or laundry delivery service. In that case, you’re going to need a business insurance policy to protect you and your business from different exposures.
Getting insured is important when starting a laundry business because it helps drive growth, earns customer trust, and protects finances. In this article, we’ll explain the different types of laundry business insurance and show you the average cost to pay for insurance premiums!
For the most part, laundry business insurance is relatively straightforward. It is simply designed to protect you and your business from the different risks that will deal significant losses on business funds.
You might think that a laundry business is free from exposures (contrast this to commercial construction insurance ). After all, you’re just washing clothes, right?
But in reality, there are a number of different risk factors that you need to be aware of. This is especially true when you’re dealing with higher-end fabrics, designer clothing, or providing laundry service to wealthy executives and homeowners. Below are some of the most common risk factors associated with commercial laundry insurance.
Property damage is usually the most commonly occurring risk factor in the laundry industry. Many pieces of clothing are fragile, and if they aren’t treated properly, then they can easily rip, tear, or fall apart under the strain of the washing machine or high temperatures. While the blame may be on the customer for bringing their clothing to your laundry business, to begin with, it’s not uncommon for disgruntled customers to try to shift the blame on you instead.
For lower-value clothing, this typically isn’t something that you’ll have to worry about. Most people aren’t going to sue your business over a $10 shirt or a $75 suit. However, if you mess somebody’s $4,000 clothing from a high end fashion store , then that could be a very different story.
If you run a laundry business that allows customers to come inside and use the washing machines, dryers, or irons for themselves, then there’s always a possibility for bodily injury. For example, a child could slam their fingers in a washing machine door, or an elderly individual could trip over a heavy-duty cord running across the floor.
Without coverage for bodily injury, then you and your business could be held financially liable for paying for that customer’s medical bills, physical therapy, or even disability. The right insurance company would be able to negotiate a fair amount and pay it out of your policy, saving you from heft medical bills.
If your laundry business or dry cleaning business offers a delivery service, road-related exposures might disrupt business operations. For one, the vehicle you’re using for delivery may need to be insured with a commercial auto insurance policy to provide coverage if your delivery driver is ever involved in an accident.
Additionally, you may also need to purchase insurance coverage to cover the brief period of time when your delivery driver is on another person’s property. For example, your driver could drive over a customer’s expensive grass, knock over a costly garden gnome, or even steal from a client’s home. A liability policy will help protect your business from customer claims against your delivery team.
Let’s discuss the different types of laundry business insurance policies available and what each covers.
Public liability insurance will cover costs if your business causes personal injuries or property damage to third parties or members of the public. Take a look at these example situations where public liability insurance will be absolutely useful:
The grounding of one of your business’s laundry machines is very poor and shocked a customer that was using it. Because of the shock, the customer dropped her phone. As a result, the customer holds your business responsible for replacing her damaged device
One of your laundry machine's lining is leaky. It’s spilling liquid on the floor. A customer failed to notice the wet floor and experienced a slip and fall accident on the premises of your business
Your business’s laundry machine suddenly exploded. Customers nearby suffered minor injuries and had some of their personal effects damaged
Public liability insurance provides wonderful protection against personal injury claims and property damage claims from members of the public or third parties. However, if you want to be protected from other exposures associated with your business’s interaction with people, get general liability insurance.
Almost all laundry businesses will benefit from a general liability policy. On a side note, this is also available in window cleaner's insurance and gutter cleaner's insurance. General liability insurance is a comprehensive version of public liability insurance. Aside from personal injury claims and property damage claims, general liability covers your liability for reputational harm and damage to rented premises through the following add-ons:
Advertising injury coverage
Rented premises liability coverage
You might unintentionally copy another business’s ad when making a marketing campaign. It’s also possible for competitors to accuse you of committing slander or libel. Copyright infringement, libel, and slander claims are expensive. The minimum attorney fee is $185 per hour and the minimum settlement is $415,000.
In line with this, advertising injury coverage will make sure that you don’t lose money if someone files a claim against your business for reputational harm. This add-on in general liability insurance will take care of defense costs and settlements. In fact, the majority of laundry businesses decide to add advertising injury coverage to their general liability policy.
Rented premises liability coverage isn’t as popular as advertising injury coverage. This is because it’s only useful for businesses who are renting commercial space.
When renting, you’ll have to shoulder costs or reimburse the property owner if the commercial space is damaged because of fire or any other related causes.
Of course, using your own money will result in losses. This is where rented premises liability coverage is valuable. Basically, it will reimburse the landlord or get the building repaired on your behalf. Understand that most landlords require tenants to have general liability insurance having rented premises liability coverage before signing the rental contract.
If your laundry sells cleaning products like bleach, washing soap, or fabric softener, then you should never rule out the possibility of a product liability claim. One of these products could be faulty and cause damage to a customer’s clothing or even cause an inflammatory reaction on their skin. Product liability insurance will pay for defense costs and settlements if your business’s physical cleaning products cause problems. By the way, insurance companies offer product liability insurance as a stand-alone policy or as another add-on in general liability insurance.
If you offer a specialty service such as delivery, dry cleaning, ironing, starching, or clothing repair, then you could also benefit from professional liability insurance.
A customer might accuse your business of committing negligence and causing economic or financial loss. For example, if a customer wants a hard-to-remove stain taken out of an expensive wedding dress and you’re unable to do so (despite your best efforts), they could try to sue you for claiming that you could.
Also, someone might file a claim because an employee committed a mistake which in turn led to the customer’s losses. For example, an employee might have applied the wrong cleaning agent on the customer's clothes.
Workplace mistakes and negligence aren’t the only perils covered by professional liability insurance. You can also use this policy as protection against claims for misrepresentation or violation of good faith.
So how does professional liability insurance work? Just like other liability policies we discussed, professional liability insurance covers defense costs and settlements.
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Insurance companies don't only offer general liability, public liability, and professional liability insurance for laundry businesses. Other available endorsements or stand-alone options are:
Commercial property insurance
Workers compensation insurance
Business interruption insurance
Your laundry business has its own commercial space that fire or extreme weather might utterly destroy. Vandals, thieves, extreme weather, fire, and other perils might also cause minor damages to signages, glass panels, windows, and other structures.
Building reconstruction or repair is very costly. We’re sure that you don’t want to use your financial reserves for these. To ease your worries, cover your business with commercial property insurance.
Commercial property insurance will pay for reconstruction if your laundry business’s commercial building is destroyed by fire or extreme weather. It will also pay for repair costs if your commercial space only incurred damage from theft, fire, vandalism, extreme weather, and other covered perils.
There are optional policies in commercial property insurance - business equipment and tools coverage as well as stocks and contents coverage.
As its name implies, business equipment and tools coverage will reimburse your losses if the laundry machines and other equipment of your business are damaged or lost because of fire, theft, vandalism, and other covered perils.
Aside from equipment, you also need to cover cleaning agents, soaps, powders, and other substances customers purchase to clean their clothes. Stocks and contents coverage is what you can use to do so. This optional policy will reimburse losses if cleaning agents, soaps, powers, and other valuable materials in the inventory become lost or damaged because of fire, theft, vandalism, and other covered perils.
How many employees does your laundry business have? One? Two? Or something more numerous? Regardless of how many and no matter if they’re family members or not; so long as you have employees, workers compensation insurance is always essential.
Workers compensation will make sure that you won’t use financial reserves to treat, rehabilitate, and compensate for the lost income of an employee who experienced a work-related injury or disease. Speaking of lost income compensation, the employee can get insurance money equal to two-thirds of the average weekly wage. Also, workers compensation insurance will provide the allowance for three or seven years.
Refusing to get this coverage is impossible. Workers compensation insurance is a state-mandated coverage. That’s why many businesses get this even though it's expensive. Failure to get workers comp might put you in prison. But commonly, all you’ll have to face are stiff penalties which can be fixed amounts, increment amounts based on how many days you didn’t have coverage, or twice the amount you would have paid for workers compensation insurance premiums.
Business interruption insurance is the equivalent of loss of income coverage for independent professionals. Unexpected events might force you to halt business operations for a while. The purpose of business interruption insurance is to make up for the income you would have earned and would have used to pay for employee wages, bills, rent (if applicable), loans, and other operational costs.
Below, you’ll find the most common forms of insurance coverage necessary, depending on the laundry service that your business provides.
Laundromats (or launderettes, if you’re from the UK) typically need a comprehensive plan that includes public, professional, product, and general liability coverage.
Most dry cleaners’ insurance programs include general liability coverage and professional liability coverage. However, since most dry cleaners don’t have facilities open to the public, they may not need a public liability policy.
If you own a laundry delivery service (or if your laundromat/dry cleaners provides a delivery service), then you’ll need to add additional coverage for commercial auto insurance to insure your delivery vehicle.
If your laundromat provides a custom tailor or clothing repair service, you may qualify as a commercial artisan. In connection, you may need to purchase additional coverages included in artisan insurance, given the specialized nature of the service.
Assuming that you purchase a general liability insurance policy with $1,000,000/$2,000,000 coverage (which is standard for laundry businesses), listed below is what you can expect to pay from various commercial insurance providers. Generally speaking though, laundry business insurance cost is $46 per month or $552 per year.
|Insurance Provider||Average Monthly Premium||Average Annual Premium||Best for|
|CoverWallet||$28||$336||Laundry, dry cleaner, and laundromat insurance quotes comparison online|
|Thimble||$32.48||$389.76||Short-term laundromat insurance with hired and non-owned auto coverage|
|Next||$46.21||$554.52|| BOP with workers compensation insurance having an optional employer’s liability coverage |
|USAA||$48||$576|| Insurance for laundromat businesses owned by military veterans or active military personnel |
|Chubb||$53||$636|| Insurance coverage for small, medium, and multinational laundry or dry cleaning businesses |
|State Farm||$56.79||$681.48||Tailored laundromat insurance with employee dishonesty optional policy|
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Here are some reviews that provide an idea about the pros, cons, and pricing for $1 million general liability coverage of the best laundry, laundromat, and dry cleaners insurance companies.
Compare laundry, dry cleaners, and laundromat insurance quotes online
Get insured online
Cancel a policy anytime
General liability starts at $200,000 minimum limit
Commercial auto insurance for dry cleaners and laundromats isn’t very comprehensive
CoverWallet has a tailored laundry, laundromat, and dry cleaner's insurance. The company made these insurance products by customizing the quotes of partners. You have four insurance options to choose from - general liability only, general liability and commercial property, business owner’s policy with workers comp, and a custom plan.
Work with CoverWallet because you can cancel your coverage anytime, no questions asked. Prepare to be patient though since CoverWallet’s policy cancellation process takes 15 - 30 days.
Best for: Dry cleaner and laundromat insurance quotes comparison online
Average cost: $28 per month
Our rating: 10/10
Get insured online
Has a lot of inclusions laundromat insurance
Laundromat insurance is offered as a BOP that’s also available as a short-term insurance
Doesn’t offer workers compensation insurance for laundromats
Thimble’s laundromat insurance is a business owner’s policy that bundles commercial property and general liability insurance. General liability offers $1 million - $2 million in coverage.
This company’s laundromat insurance includes equipment breakdown coverage and hired and non-owned auto insurance as optional policies. Additionally, you may even endorse business interruption insurance.
Best for: Short-term laundromat insurance with hired and non-owned auto coverage
Average cost: $32.48 per month
Our rating: 9/10
Bundle policies and get a 10% discount
Available in all 50 states
Online claims filing and tracking
Doesn’t offer commercial auto insurance for laundromat businesses
NEXT’s laundromat insurance comes in the form of a business owner’s policy that can be added with workers compensation insurance. If you’re looking for an online insurance company that offers coverage regardless of your location, NEXT is your best bet because it’s available in all 50 states. Other perks this company offers are innovative and instant certificate of insurance, policy bundle discounts, certified insurance agents, and online claims filing and tracking.
Best for: BOP with workers compensation insurance having an optional employer’s liability coverage
Average cost: $46.21 per month
Our rating: 8/10
Cheap rates for those who qualify for USAA’s business insurance plans
Fast to process claims
Service provided is exclusive
If you’re a former military or active military personnel running a laundromat business, USAA is a good option because it offers very reasonable rates. This company offers general liability, business owner’s policy, and stand-alone workers compensation insurance.
Best for: Insurance for laundromat businesses owned by military veterans or active military personnel
Average cost: $48 per month
Our rating: 7/10
Offers laundry and dry cleaners insurance program with risk engineering services
Can cover you regardless of business size
Doesn’t offer a lot of insurance products for your laundry business
Chubb offers general liability insurance and stand-alone products liability insurance for your laundry or dry cleaning business. Decide to work with this company because you’ll have coverage regardless if you’re just a small business or a business operating in different states.
Best for: Laundry insurance coverage for small, medium, and multinational businesses
Average cost: $53 per month
Our rating: 6/10
Has numerous customer service lines, so that dispute resolution is efficient
You can get a quote online or by calling a State Farm agent
Pay your premiums online
Traditional insurance process - you have to find an agent’s help to be insured
State Farm’s laundromat insurance includes business interruption, commercial property, rented premises liability, employee dishonesty, and business equipment insurance policies for laundromat businesses. Work with State Farm because it resolves your complaints within a week. Furthermore, insurance agents will be ready to teach you what insurance policies best fit the unique risks your laundromat business faces
Best for: Tailored laundromat insurance with employee dishonesty optional policy
Average cost: $56.79 per month
Our rating: 5/10
If you own a laundromat business, then you’ll usually need to purchase business insurance before your city or state allows you to start offering your services. This means that time is of the essence. To help you find the cheapest laundry business insurance quotes from the best laundry business insurance companies, use our online quotes generator tool. Simply click the " Get Quotes " button and follow the process to receive and compare online quotes from top providers and find the best insurance for your business.
Lonnie Bell Insuranker
Policy Type: Business Insurance
Company name: Employers Insurance
Use anyone except Employers. Period. They are non-transparent and shameful. After I complained long enough to warrant a call from a supervisor, the supervisor called back from a PRIVATE NUMBER (no caller ID), left a message that they are not reversing their decision (without any communication with me), and failed to leave a phone number for me to call back. She was hiding! They also fact find via email and phone calls, which is terrific for speed and communication. However, after setting a precedence of email or phone calls, they send time sensitive information via email, without any heads up... they are hoping you miss it and forfeit via expiration. Evil policies. Go elsewhere.
This place is an absolute joke of a company and should be ashamed of the way they conduct business. I was hurt on the job at the end of July and it took them just shy of 7 weeks to issue out a paycheck to me. Yes the amount was back dated but still. Not many have the luxury of not receiving a paycheck for almost 2 months. To top it all off, the original adjuster marked me down for the wrong state which caused a problem from the get go, I've had 3 different adjusters now since each one can't seem to figure out the simplicity of my claim. All my paperwork which includes, my job, house, and drs visits all are from the same state and city but yet some how I have been filed under a completely different state 1500 miles away. They do not answer your phone calls or emails no matter how many you leave. I've had to escalate my frustrations to the supervisors of each of these individuals in order to even get some kind of response. I've had more communication and information given to me about my claim from the customer service representatives then the actual adjusters.......... please tell me how that works?! A serious overhaul needs to happen here in order to serve your clients the way they deserve to be taken care of. 10/10 do not recommend this company to a single soul on earth
I have never had the displeasure of working with a more incompetent and disrespectful person in my life. I’m an injured worker and the adjuster that was assigned to my case was named Carrie Furgeson. In the past 6 weeks that I’ve been injured and out of work I have only been able to get ahold of her twice, not for lack of trying. I have left countless voicemails, countless emails, and she ignores them all. When I am finally able to get ahold of her I’m greeted with terrible customer service. She is rude, she talks over me and I’m hardly able to get a word in edgewise. She spelled my name wrong on my documents even after I spelled it for her properly countless times, this caused a whole new issue with my bank. I have bill collectors from the hospital calling me demanding payment and Carrie Furgeson won’t do a single thing to help, or to get them paid. All of my documentation is in Colorado, my job is in Colorado, my address is in Colorado, all my Dr offices and appointments have been in Colorado and Carrie still managed to hold my claim because she wasn’t sure what state she needed to file it under. It’s been 6 weeks since my Injury and my company still hasn’t received the wage paperwork to fill out so they can get me my correct wages. When she’s not ignoring me she’s answering my questions with “I don’t know” well I don’t know how she got this job, because apparently she doesn’t know anything about it. She is a disgusting morose individual inside and out and I genuinely wish her the worst in all of her future endeavors. I highly recommend you don’t use this company. Please if you are a business owner and your looking into this company please don’t use them. I’m sure they have the cheapest payment and that’s why companies use them in the first place, but you will be doing your employees a grave disservice by forcing them to venture into this absolute dumpster fire of a company. I would rate 0/5 if possible but 1 was the lowest I was allowed.
Their general liability insurance purchase process is simply the best online experience I've ever had in my life!
As long as they cover your line of business, you're literally covered! best rates, best coverage, best online experience, best professionals, can't be happier that I chose them!