Why Do Furniture Stores Need Insurance?
Furniture stores and other home improvement stores have been busier than ever. Because of the Coronavirus pandemic, hundreds of thousands of people have been stuck working from home. Because of this, many of them are doing some serious home renovations—including buying new furniture.
The influx of traffic in your furniture store means you need to make sure you are properly protected against any risks you may face. As a furniture store owner, you want to make sure you have the proper insurance coverage so that your business can remain healthy. Tivly is here to help you understand the difference in the policies and clarify how they protect you. But first, let’s talk cost.
How Much Does Furniture Store Insurance Cost?
You may be worried that buying insurance may cut down on your profits. But is insurance for furniture stores really that expensive? The average furniture store spends $47 to $69 a month or anywhere from $400–$1,500 a year for $1 million in general liability coverage. However, many factors influence the cost of coverage:
- What is the square footage of your store?
- How much inventory does it hold?
- Where is your business located?
- What type of furniture do you sell? How much does it cost to replace?
- What is your annual payroll? How many employees do you have?
- Does your store offer furniture delivery? How many vehicles do you have?
An insurance agent will ask these questions (and likely a few more) to help you determine what insurance you need and how much coverage you need to get you an accurate quote.
The Types of Business Insurance You’ll Need
Now that you know what a general liability policy could cost, what other furniture store insurance policies should you consider? What does general liability insurance entail?
General Liability Insurance
General liability insurance covers your business if you’re accused of third-party bodily injury, third-party property damage, or advertising injuries (think libel, slander, or copyright infringement). It is the most common type of business insurance that everyone needs. This insurance plan will pay up to the policy limits you choose for expenses such as court fees, defense costs, monetary awards, and out of court settlements. Here is how this policy is usually organized:
- Premises liability insurance: this is the portion of your general liability insurance that protects you from third-party bodily injury and third-party property damage while a customer is in your store or on your property.
- Product liability insurance: If any of your furniture is faulty or defective and either hurts a customer or damages their home, your policy will help cover their medical costs or pay to repair the damage.
- Advertising liability: If you accidentally infringe on someone’s trademarks, or commit libel or slander, general liability can provide legal representation and cover settlement costs when necessary.
Commercial Property Insurance
Commercial property insurance (also called business property insurance) will cover your buildings, the property around your building, equipment, and most importantly—your inventory. It works similarly to homeowner's insurance. If a covered incident takes place, the business owner would file a claim with the insurance company. A claims adjuster will then take a look at the loss and make sure that the circumstances are within the scope of the policy. If it does, the business is compensated for the loss.
Common risks include fire, storm damage, vandalism, theft, or accident, such as a tree falling on the building. If you’re in an area of the country prone to flooding or earthquakes, consider adding these coverages:
- Commercial flood insurance: A flood—even caused by burst pipes or heavy snowfall—can decimate your inventory. If you’re in an area that floods frequently, consider protecting your business with a flood insurance policy.
- Commercial earthquake insurance: If you’re in a state where earthquakes are common, make sure your structure is protected with earthquake coverage.
Check with an insurance agent to find out if these additional coverages are necessary for your furniture shop.
Consider a Business Owners’ Policy for Your Furniture Store
Did you know as a small business owner, you can bundle coverage into something called a business owners’ policy (BOP)? A business owners’ policy typically includes general liability, property insurance, and business interruption insurance. A BOP is often offered to small business owners at a discounted rate compared to purchasing each insurance policy separately.
Commercial Auto Insurance
If your furniture store offers delivery services, you need commercial auto insurance. Much like a personal auto policy, the commercial auto policy out up to the policy limits.
Example: One of your delivery trucks is delivering living room furniture to a customer. En route, the driver sideswipes a car, sending it into a ditch at the side of the road, where it rolls over onto the top. The family is taken to the hospital and because you caused the accident, your furniture store is on the hook for the medical bills, rehabilitation costs, and any awards a court might make. Without commercial auto insurance, you would be out of business.
Workers' Compensation Insurance
Workers' compensation insurance is a must-have business insurance coverage. Currently, all states except for Texas legally require business owners with employees to get workers' compensation. Even in Texas, you would be wise to look into this coverage, as it can save you and your business in the event an employee suffers a work-related injury, even if the injury is the fault of the employee. Workers' comp insurance will cover medical bills and lost wages for any employee who qualifies (as long as they weren’t breaking the law when they were injured).
Cyber Liability Insurance
Most furniture stores sell online or store customer information when a purchase is made. What happens if your website is hacked? All of that information can be compromised. But if you have cyber liability insurance, your insurance company can provide your impacted customers with credit monitoring. The insurance company can also help you notify impacted clients. If customer information is stolen and held for ransom, cyber liability can cover random demands.
Get a Free Furniture Insurance Quote Now!
Insurance for furniture stores doesn't have to be complicated! Our mission at Tivly is to help small businesses like yours manage risk by finding business insurance quotes at a reasonable price. Have more questions? Want to get started? Complete the form at the top of the page or call us at 877-907-5267 to get started with your free quote. We'll gladly help you get the business insurance you need to protect your furniture business.