Clothing stores help bring fashion to life. Your store connects customers with garments that express their true style. But shoppers only see the storefront; a lot more goes into keeping your clothing shop up and running. You deal with commercial shipments, inventory, storage, payment processing, staging, sales quotas and much more on a regular basis!
Without business insurance for clothing retail stores, your company is, well, underdressed. Before you open your doors and start assisting customers, you need to have the right protections in place. Here are five reasons that show why clothing stores need business insurance.
A customer falls and sustains a serious injury
Something as simple as a tiny puddle from a water bottle can be life-or-death for your clothing store’s financial future. Let’s say the next customer to come along doesn’t notice the leakage, and neither does your sales team. Suddenly you have a customer down in the middle of the floor, writhing in agony and threatening to sue your company. You call an ambulance and try to keep them as comfortable as possible, but you know you’re in hot water.
Sound far-fetched? One Pennsylvania woman just won a $2.1 million settlement after a slip-and-fall accident at Target in which she did a split, pulling her hamstring out of her hip socket. The plaintiff alleged that employees had mopped outside of the area blocked off with warning cones.
Could you afford such a pricey verdict if a customer fell in your store? Likely not. That’s why commercial general liability insurance covers legal and medical fees as a result of personal injury, bodily injury or property damage to non-employees in your store.
Shoplifting cuts into your bottom line
Theft is a serious drain on retailers’ finances. A shirt here… a pair of jeans there… suddenly you’re looking at losses in the thousands every year due to swapped tags and swiped items. Look for a property insurance policy that includes theft losses (in addition to other catastrophes like fires, burst pipes and vandalism) so you can rest assured that you’ll receive the Actual Cash Value (ACV) or Replacement Cost Value (RCV) for damaged or stolen items.
Your payment system goes down during busy season
You depend on seasonal spikes to keep your business afloat. What if your electronic system goes down just before your annual Black Friday sale? There’s no way you’ll be able to hit your sales quotas now! You’ll worry less if you include business interruption coverage in your Business Owners Policy (BOP). It helps you keep your head above water if something stops you from conducting business as usual.
A worker injures their back unloading a shipment
A sales associate tweaks their back unloading a new shipment of shoes. Not only are you down a worker, but they need a doctor’s appointment, medication, time off work and possible rehabilitation to recover. Workers compensation, required in most states, covers these expenses.
A cyber hack compromises your customer data
Your store conducts payment transactions online; you likely store your records somewhere in the cloud or on an internal server. Unfortunately, hacks are on the rise. Just last year, Eddie Bauer was the victim of a malware attack that infected their system and sent some cardholder transactions back to criminals, as Fortune reports. Cyberattacks can cost stores big time—and boutique stores usually have the hardest time affording the reparations. That’s why cyber insurance can be a lifesaver for clothing stores in the event of a data breach.
Think twice before operating without business insurance for clothing retail stores. Need to find a policy that fits or update your existing one? Visit CoverHound for more details.
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