How to Protect Your Retail Business from Liability Claims

Liability is a serious and nerve-wracking threat if you are a retail business owner, especially if your business is small or just starting out. One lawsuit or claim can cost thousands or even millions of dollars which many small businesses can’t afford. yellow hard hat next to a chalkboard that says safety first

yellow hard hat next to a chalkboard that says safety first

It is important to identify the main liability risks facing your retail store so that you can plan accordingly. Take measures to protect your business against liability lawsuits and to keep everyone involved safe, including employees and customers.

Alert Customers to Potential Hazards
The easiest way to protect yourself from a potential liability claim against your business insurance is to always alert customers to potential hazards. This includes putting out signs when flooring is wet due to cleaning or rainfall. And marking any odd doorways or steps that might present a tripping hazard. If there is clear signage signifying an issue, you’ll likely prevent an incident from happening.

Train Employees to Keep a Safe Environment
It is also important to train employees in the art of keeping a safe environment. Remind them to always keep tripping hazards to a minimum by preventing stretching electric cords across aisles, putting away ladders used to change displays, and keeping inventory put away neatly. By making safety a part of your normal operating procedure, you can ensure that the work environment around your shop is safe for both shoppers and fellow workers.

Maintain Your Premises
A large segment of insurance claims against business insurance include incidents that are preventable with a bit of building maintenance. Make sure things like handrails on stairs, loose tile, and broken sidewalks receive repair as needed. If you rent your location, keep clear records of when you alerted management to the issues. This helps reduce the risk of an incident before it even occurs. It also ensures that your business looks great to potential customers.

Insure with the Right Protection
Even with all of the safety measures in place, accidents can still occur. This is when it is important for you to have the right commercial insurance policy to protect your store and its assets. Liability insurance can protect you in case of claims against your business.

General liability insurance is one of the most common and important types of insurance. This covers claims against your business concerning bodily injury, property damage and personal or advertising injury. If someone slips and falls in your retail store, general liability insurance can help pay for their injuries as well as protect you in case of a related lawsuit.

Other important insurance options for retail stores include:

Professional liability: As opposed to general liability, professional liability provides coverage against claims made against your business due to errors and omissions or negligence.

Directors and officers: Directors and officers liability coverage protects your business in case a claim is filed against one of your directors or officers.
Cyber liability: If you run a business with an online store, you will want cyber liability insurance. This provides coverage in case a cyber attack which can cause information leaks, blackmail and more.
Employment practices liability: Employment practices liability provides coverage in case an employee files a claim regarding violation of their legal rights by the company.
Liquor liability insurance: If your store sells liquor, you’ll need liquor liability insurance to protect you in case a customer commits a crime or other deed after drinking alcohol bought from your store.
Property/inventory insurance: A retail store has a lot of items to cover. If a disaster strikes or if your goods are stolen, it’s important to have the loss covered with property insurance.

All businesses typically require workers’ compensation in case an employee is injured on the job. This is especially important for pet stores or any retailers selling heavy equipment. Additional insurance that stores may need are:

Commercial auto insurance: Personal auto insurance most likely won’t cover you or your employees when driving vehicles used or owned by the business, which is where commercial auto insurance steps in.
Inland marine insurance: If you transport goods and equipment often, those items may not be covered by personal or commercial auto insurance. Inland marine insurance offers coverage for goods and equipment damaged or stolen while in transport.
Jewelers block insurance: Jewelry stores or stores that carry jewelry will want to invest in jeweler’s block insurance. Property or inventory insurance may not cover expensive jewelry items.

You can often bundle these policies into a business owners policy, which combines coverage for small businesses in low risk industries in order to save you money without sacrificing important coverage.

Speak with an insurance agent about ways you can protect your business with insurance. Protecting your retail store can also save you money on insurance by reducing the risk of an accident.

How to Protect Your Retail Business from Liability Claims

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