Americans love their sports. Sporting goods stores can specialize in a single facet such as hunting, golfing or biking, or they may provide goods pertaining to all types of sports. Regardless of their scope, these stores all have one thing in common: they need to be protected by an appropriately built commercial insurance policy. If you are the owner of a sporting goods store, you may want to consider working with an independent insurance agent to help ensure that your many exposures are covered.
2014 Sporting Goods Store Industry Facts According to IBISWorld
- There are more than 40,000 sporting goods stores in the United States.
- These stores employ more than 275,000 people.
- Sporting goods stores generate approximately $50 billion in revenue each year.
What Could Go Wrong at a Sporting Goods Store?
All retail establishments need commercial insurance protection. Sporting goods stores, however, have a few unique considerations to take into account. For starters, your inventory is likely to be quite valuable and may be more plentiful during certain peak seasons. Furthermore, many consumers like to try out products before they buy them, and this can increase the risk of injuries occurring in your place of business.
What Sporting Goods Store Owners Should Know About Property Coverage
As mentioned earlier, different types of stores can have certain times of the year when their inventory is much more plentiful than at other times of year. For example, a bike shop may increase its inventory at the end of the winter in anticipation of increased sales as spring weather breaks through. A gun store may increase stock of certain items in advance of hunting season.
If your store experiences times when the inventory is greater than usual, you may benefit from purchasing an endorsement to your policy that will increase your property coverage during those specified peak times. That way, you do not have to be worried about being underinsured when your inventory is high, and you will not pay too much for your coverage during the rest of the year. Additionally, if you own a bike shop or golf shop that rents out equipment, you may need to purchase inland marine insurance to cover your property while it is outside of your control. Be sure to speak to your insurance agent about your store’s unique property coverage needs when building your policy package.
What Are Some Liability Risks Unique to This Industry?
All business insurance policies include general and premises liability insurance. This will protect your business in the event that a customer suffers a significant injury while in your retail establishment. The cost of this coverage will vary by store type and perceived risk; and within the sporting goods industry, there is a lot of variance.
For example, when writing a bike shop insurance policy, an insurance company may take into consideration the fact that customers like to try out the bikes before they purchase them, and this can open the door to potential injuries. They will also note that if the employees at the bike shop did not properly assemble the bike and someone becomes injured while riding it, the store can be held liable. Likewise, when underwriting a golf shop insurance policy, insurance companies may take into account the possibility that a customer may injure someone else while taking a practice swing with a club. Each type of sporting goods store carries its own unique risks.
General liability insurance covers court costs, legal fees and financial damages if your store is sued for a covered event. It is important to remember, however, that general liability insurance does not always cover all risks nor does it always offer full coverage. This is why it is important to speak with an experienced insurance agent, who can help you purchase the right coverage.
A Word About Liability Risks When You Sell Weapons
Some sporting goods stores sell hunting goods including guns, crossbows and other weapons. If your store sells guns and ammunition or other weaponry, your insurance risks are much higher and you may find it more difficult to finds insurance companies willing to provide gun shop insurance. Of course, there are companies that specialize in this sort of coverage, and your independent agent can help you find them.
When you carry guns and ammunition as store merchandise, the cost of your liability insurance is going to be high mainly because a disaster in this case has the potential to be catastrophic. You may be able to lower your coverage costs by maintaining strict safety protocols such as keeping weapons and ammunition separated and keeping ammunition locked up. Your gun shop insurance company is likely to provide you with a list of safety protocols and may perform routine inspections to ensure that your employees are carrying out these protocols. Failure to maintain a safe environment can lead to the cancellation of your policy.
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What Other Coverage Do You Need for Your Sporting Goods Store?
In addition to property and liability coverage mentioned above, there are other insurance types that you may need for your sporting goods store:
- Flood Insurance: Business insurance policies rarely cover water damage caused by floods. To obtain this coverage, you will need to purchase a commercial flood insurance policy through the NFIP.
- Business Income Insurance: A major disaster may force a temporary closure of your business until you can make repairs. If the disaster is among your policy’s covered events, business income insurance can provide your store with a continuation of income until you can resume normal business operations.
- Workers' Compensation Insurance: You are required to cover the cost of treatment of injuries sustained by employees while on the job. Workers' compensation insurance, which is required in most states, provides compensation in these cases.
- Health Insurance: If your business has at least 50 full-time employees, you are required to provide them with affordable health insurance. You insurance agent can help you find suitable coverage.
- Cyber Liability Insurance: This is a new type of insurance that provides liability coverage in the event that hackers break into your business’s computer system and steal sensitive customer information such as credit card numbers.
How To Find Specialty Business Insurance for Your Sporting Goods Store
The most important thing when building a business insurance policy package is that you sufficiently cover yourself against all potential exposures. Whether you are looking for bike shop insurance, golf shop insurance, gun shop insurance or any other type of sporting goods store insurance, working with an independent agent in the Trusted Choice® network can make finding the right policy much easier.