Part of homeownership is keeping your house maintained and updated. Many homeowners prefer to tackle home improvement jobs on their own, and these people rely on home improvement stores for the supplies they need to get the job done. These stores are plentiful and sought after, and the industry has a lot of room for growth. If you have put your time and money into opening this type of business, you will want to protect that investment with a suitable home improvement store insurance portfolio.
2014 Home Improvement Store Industry Facts From IBISWorld
- There are nearly 5,000 home improvement store businesses operating in the United States.
- These stores employ more than 637,000 people.
- The home improvement store industry is responsible for about $161 billion in revenue each year.
Get Sufficient Property Damage Coverage for Your Home Improvement Store
Most home improvement stores carry a large inventory. A single disaster, such as a fire, has the potential to result in millions of dollars in losses.
- Property insurance: Property coverage is part of any commercial insurance policy. You will want to be sure that you have enough coverage to fully compensate your business if it suffers a total loss such as in the case of a fire. You can purchase coverage for your inventory, shelving, computer systems, and registered and other business property on your premises. Bear in mind that for items that are stored outside, your coverage will most likely be limited.
- Inland marine insurance: This property insurance covers goods that are being transported to customers during deliveries as well as machinery such as floor sanders that you may rent out to customers while it is not in your custody.
- Flood insurance: Commercial insurance policies do not include coverage for flood damage. As a flood can lead to very expensive losses to your business, it is in your best interest to invest in a commercial flood insurance policy through the National Flood Insurance Program (NFIP).
- Earthquake insurance: Commercial insurance policies also exclude coverage against earthquakes. If your business is located in a seismic zone, you may want to purchase this additional coverage so you can be compensated for damage caused by earthquakes.
- Hurricane insurance: Wind and storm damage are typically covered by commercial insurance. In areas with a high probability of hurricane damage, this coverage is often excluded. In this case, you will need to purchase a supplemental policy. If you feel that your business is at risk for hurricane damage, be sure to ask your agent what is and is not covered by your policy.
Home Improvement Stores Need the Right Liability Insurance
Anyone can sue anyone for anything. This is an important fact to keep in mind when purchasing liability insurance. Even frivolous lawsuits can cost your company thousands in legal defense fees before they are thrown out of court. Liability insurance provides compensation for legal fees, court costs and financial losses for lawsuits stemming from covered events. It is therefore important that you have the right coverage.
- Premises liability insurance: Part of your general liability coverage, this insurance protects your business if a customer is injured or suffers property damage while in your store.
- Product liability insurance: Also part of your general liability coverage, this protects your business if a customer suffers bodily injury or property damage because of a faulty product you sold.
- Commercial auto liability insurance: If your store owns a fleet of vehicles used for deliveries or other business needs, you will be required to purchase commercial auto insurance. The liability portion of this policy protects your business from financial losses if one of your drivers is responsible for an accident.
- Pollution insurance: Your store likely carries paints and hazardous chemicals that have the potential to pollute the environment. Speak to your insurance agent about pollution insurance for assistance in determining whether this coverage is a good idea for your home improvement store.
- Professional insurance: If your store offers professional design services such as for a new kitchen installation, you run the risk of a lawsuit if the design is faulty. In this case, you may need professional liability insurance to get the coverage you need.
Other Insurance That May Benefit Your Home Improvement Store
In addition to the property and liability coverage mentioned above, there are other insurance coverage types such as the following that may be required or are at least worth considering:
- Business income insurance: A major disaster can force you to halt business operations while repairs are made. If this temporary closure is an extended one, it can mean a major financial hardship for your company while it is not making sales. This insurance coverage provides your business with a continuation of income that permits you to pay salaries and monthly expenses until your business is able to reopen.
- Workers' compensation insurance: If an employee is injured on the job, your business is legally obligated to pay for necessary medical treatments. Workers' compensation insurance provides coverage for this treatment. This insurance is mandatory in most states.
- Employment practices liability insurance: This insurance protects your business assets if your home improvement store is sued by an employee for wrongful termination, discrimination, sexual harassment or other illegal business practice.
- Health insurance: The Affordable Healthcare Act requires companies with more than 50 full-time employees to provide their employees with subsidized health insurance. If you will be providing health insurance to your employees, an independent agent can help you review policy options.
There may be additional types of insurance that you may want to add to your home improvement store insurance portfolio. An independent insurance agent can help you identify gaps in your coverage and can assist you with finding the right insurance coverage to mitigate those exposures.
Find Help Building a Strong Home Improvement Store Insurance Portfolio
Purchasing business insurance for your home improvement store does not have to be a difficult endeavor. When you work with a knowledgeable insurance agent in the Trusted Choice® network, you have access to someone who can help you understand your coverage options and who can assist you with finding competitively priced and suitable coverage. Because these agents are independent of any particular insurance company, they are free to shop around for the right coverage. Find an agent near you to learn more about home-improvement store insurance.