Businesses can experience a diverse number of retail liability risks. Fortunately, they can lower their liability risk by obtaining retail insurance.
Different types of insurance will protect retail businesses against several likely scenarios like shoplifting, customer injuries, and food poisoning. We’ll cover these in detail below and tell you the type of insurance you should get for each, as well as, steps to protect yourself from such claims.
Types of Risks Your Retail Store Can Experience
Keeping an eye on everyone in the store is impossible, which could lead to a shoplifting. You should be more vigilant about who enters your store and if you have employees, instructing them to look out for suspicious activity.
If a shoplifter has left your store and evaded the police, you will be at a loss, unless you have commercial property insurance. Commercial property insurance covers you in the following instances:
- Repair costs after a thief smashes the window or door to enter your store
- Replacement costs of stolen items
- Business interruption coverage in case you need time to operate your business again
Just because you have commercial property insurance does not mean you will be entirely protected. Here are some preventive measures you should consider to prevent shoplifters. You need to take the following measures:
- Add a welcome bell on your store so when each person enters your store, you will know
- Add electronic tags on all your products so when a person leaves the store without checking out the item, the door sensors will alert you by sounding an alarm
- Equip your store with security cameras to help you see every corner of the store from your computer, laptop, handheld tablet, TV, or smartphone
- Greet each customer who walks into your store
- Have enough employees spread out in the entire store
- Keep expensive products near the counter, as that will make it difficult for the thief to get the items, as they will be near you
- Pay attention to anyone in the store that looks suspicious to you
- Review the layout of the store to ensure there are no dark spaces
Accidents can occur and when they do, more times than not customers will file a lawsuit against your store. Fighting the lawsuit can be expensive, as you never know how long it will take for a settlement to reach. For this reason, you can get commercial general liability insurance to protect your business from such incidents. Here are a few example of what commercial general liability insurance covers:
- While visiting your business, a customer trips on loose flooring and is injured.
- An employee in your painting or construction business accidentally leaves water running, causing substantial damage to a customer’s home.
- A class action lawsuit is filed against your business, alleging advertisements constituted misleading information.
For this reason, it is important that you reduce the risk of a customer slipping and falling in your store. You can do that by taking these measures to ensure no one slips and falls in your store:
- If it snows in your area, you need to shovel the snow off the ground, parking lot, and even the walkways outside your store
- If you see a spill, you need to mop it up quickly instead of waiting to clean it up later
- You need check the mats you have in your store to ensure they are not loose
- You need examine the cords and put them away
- You need to ensure your store has sufficient lighting
- You need to place warning signs on the ground if you have recently mopped or waxed the floor
3. Food Poisoning
If you hand out food samples at your store or you sell food items in your store, you are at risk of having a customer file a food poisoning lawsuit against you if they get seriously ill.
If you do not have insurance, you will have to pay out of pocket to fight the lawsuit. If you manufacture and sell your own products, you need to get insurance to protect yourself in the event a customer experiences bodily injury or property damage. You should consider obtaining product liability insurance. Product liability insurance will cover you in the following instances:
- A customer falls sick and gets food poisoning after eating food at your store
- A customer buys your product and experiences bodily injury or property damage
You should also take measures to decrease the risk of a customer filing a lawsuit against you for getting food poisoning or buying and using a defective product from your store. Here is what you can do:
- Ensure employees handling food wear aprons, hair net, and gloves
- Ensure every product has correct labeling, instructions, and safety warnings
- Examine the products for design flaws and defects
- Keep the surface of counters clean
- Keep utensils and plates clean
- Look at the expiry dates of food items, throwing away expired food
4. Cyber Attacks
Lastly, retail stores also need to protect themselves against cyber attacks. They can get insurance coverage to protect themselves in the event of a cyber attack. Apart from obtaining insurance, they can also decrease the risk of becoming targeted by hackers by educating their employees on how to identify cyber threats, instructing them to create difficult passwords, and establish policies and procedures to manage employees’ computer privileges and restrict network access. They also need to encrypt sensitive and private information when they transfer files online.
If you think your business needs cybersecurity insurance, check out our: Does my company need Cyber Security Insurance?
If you own a retail store or have plans to open up one soon, you should neglect to obtain the variety of different insurance coverages we discussed here. It is essential that you protect yourself and your business from such claims and take steps to ensure these claims do not arise in the first place.
Questions? We’re here to help!
We hope you found this article helpful. If you need to speak with an agent, please feel free to use the chat feature in the bottom left-hand corner or contact us at 203-481-8898. If you’d like to get a free commercial vehicle insurance quote please visit our Retail Insurance page for more information about how we found the insurance policies for our clients for over 30 years.
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