Small business owners rely on their day-to-day profit to make ends meet. For example, the ice-cream joint down the road or the hotdog van in the next block calculate their profits at the end of the day. Imagine there’s a flood or tornado that destroys their shop. Or maybe thieves loot their shops when they are away. They would have to start from scratch all over again. Well, they wouldn’t have to if they had shop insurance. It is a true safety net that safeguards your business.
What is Shop Insurance?
Shop insurance provides financial coverage to shop owners if their businesses get hit by natural calamities, manmade disasters, or theft. According to the contract between the policyholder and the insurance company, the latter has to pay the coverage amount or reimburse it if the business encounters any of the above-mentioned incidents.
How does Shop Insurance Work?
One of the reasons why this type of policy is getting more popular is that many people don’t have the money to start a huge business right from day one. They may have the skills to make it big within their industries, but not having enough money leads them to start small businesses.
Whether they own a permanent store in a corner or run a food stall, they work hard to run their businesses. What if you started such a business and a few days later some riot breaks out and people vandalise your store! You would literally be on the streets since you don’t have any more money to start the business again.
However, a shopkeeper’s insurance shields you from such incidents. You need to calculate the average value of your business before buying this insurance. This would help you figure out the coverage amount that the insurance company would provide and the yearly premium amount that you need to pay.
If the policy has terms to reimburse the cost of damage, you will have to pay for the expenses out of pocket initially. On the other hand, if the policy has provisions for direct payment, then you can calculate your total loss and provide the estimate to the insurance company. It will pay you the coverage amount.
Types of Shops that Shop Insurance Covers
Some of the shops that these insurance plans cover are as follows:
• Grocery stores
• Mobile and electronic stores
• Manufacturing and processing departments
• Shops that sell fitness and lifestyle items
• Food and eatables
• Healthcare businesses, such as clinics and diagnostic centres
• Offices
• Educational spaces
Who Requires Shopkeeper’s Insurance?
Are you still unsure whether to go for shop insurance or not? Well, think of it this way. Is the premium amount more valuable than the total cost of your business? If it isn’t, you should buy the insurance. After all, it will protect your business from thick and thin. Whether it’s a flood or robbers breaking and entering, you would hardly have to pay anything from your pocket for repairing the damages.
Here’s a list of different types of shops that require shopkeeper’s insurance:
1. High-Risk Businesses
A few businesses have a higher risk level than other businesses. For example, a fuel station has more chances of catching fire than a flower store. Or robbers may target an electronic store instead of looting a footwear shop. Therefore, if your business comes under the risky category, you must buy a shopkeeper’s insurance policy to ensure that your business has coverage for such unforeseen events.
2. Independent Shopkeepers
If your shop is your only source of living, you shouldn’t delay buying this insurance policy. As already mentioned, you may not have the money to start your business from scratch again. If a natural calamity, manmade disaster, riots, or robbers destroy your store, you need to have a backup plan ready. The insurance policy can be that backup plan. You must consider the adverse circumstances of running a business before you start the business.
3. Family Business Owners
Do you run a business that your ancestors have been running for decades? If yes, you shouldn’t risk their hard work. You never know when a calamity would strike. It would hardly take a few minutes to destroy everything that your ancestors had built for decades. Many people have family businesses like garments, footwear, antique items, or food stalls. If you are the owner now, you should do everything in your power to protect the legacy. Buying an insurance policy that protects the shop is one of the best things that you can do.
4. Multiple Shop Owners
Shop insurance is not just for those who have one store in the city. You can buy the insurance policy for your chain of stores also. For example, if you owned a shop that sold Teeth Whitening Kits and another store that sold clothing, then it would be essential. All you must do is pay an accumulated premium for all the stores every year. In that case, even if one store gets affected due to some unfortunate incident, the insurance company will reimburse the loss amount. Some people have multiple food stalls operating in different parts of the city. They can buy the insurance policy that covers all the stores together.
5. Shops in Prime Areas
Is your shop located in the heart of the city? If yes, you should definitely buy a policy to protect it. Shops located in prime locations are more vulnerable to robberies than the ones located on less popular roads. That’s because burglars have a perception that if the business owner has enough money to run a store in a prime location, he would have enough cash in the shop. That means they have an opportunity to break in and attack your store.
Shop Insurance Features
• Property protection
• Money protection
• Liability coverage
• Cost-effective plans
You may not have the budget to start your business from scratch, but your business should make enough profit to pay the premium for the insurance plan. Consider this insurance as a part of your business investment. If you want to see your business grow and flourish in the city, consider shop insurance as its protector. You will thank your stars later if, god forbid, some calamity takes place and your shop comes down to pieces, and you have the money from the insurance to get things back up and running soon.
