Traditional record stores are seen as a dying breed. But in fact, record stores have been experiencing a quiet resurgence in recent years, as some independent retailers have learned how to stay afloat and remain relevant during the digital music era.
After Tower Records closed all of its stores in 2006, the number of independent record stores in the US dwindled to around 2,000. Today that number is hovering around 2,400 stores, located mostly in smaller towns and driven by a nostalgic interest in vinyl records.
Independent record stores typically sell new vinyl records, CDs, and even DVDs. Many also sell used, vintage, and rare collectible records, which can be highly valuable.
Some surviving record stores have found a way to increase their business by hosting special events and positioning themselves as experts in music and rare recordings.
If you own a record store, you need to protect your livelihood from all of the little things—and big things—that can go wrong. You need to know the types of risks you face and how you can protect your assets and move forward even in the worst of times.
Whether you own a single record store or you operate several locations, an independent insurance agent in your city can help you find customized business insurance that helps you protect your livelihood.
Why Do You Need Record Store Insurance?
Record stores often sell a variety of recorded materials, from new vinyl records to valuable collectibles and rare items. You might even sell new and used stereo equipment and supplies.
In addition to your retail operations, you might also host special events that invite large numbers of people onto your premises at one time.
What’s most important is that you understand your unique risks, and find insurance coverage that protects against all of them. The right record store insurance helps you avoid or mitigate financial losses from unexpected events.
Consider all of the things that could go wrong (and result in serious repair costs, loss of income, or a lawsuit) during the course of your workday.
- Accidents, such as trips and falls in the store or parking lot
- Shopping carts or store fixtures causing injury or property damage in the store or parking lot
- Damage to your inventory (vinyl records, CDs, DVDs, valuable collectibles, and other highly flammable or moisture-sensitive items) due to some catastrophic or unexpected event (fire, smoke, weather, vandalism, etc.)
- Loss of income due to a catastrophic or unexpected event (a fire damages part of your store, forcing you to close while repairs are made)
- Employee theft of cash or inventory
- Employee lawsuits related to discrimination or other claims
- Cyber breaches (data breach of your online store)
What Does Record Store Property Insurance Cover?
Record stores need insurance to protect their inventory and other physical assets when they are damaged or destroyed by an unexpected event. This includes:
- Records and other inventory in your shop, including valuable collectibles and vintage items
- Furniture, fixtures, computers, office equipment, and all of your business property
- Your physical store structure if you own your building
Commercial property insurance protects buildings and their contents, such as computers and cash registers, inventory, equipment, furniture, fixtures, and more. It helps you rebuild or make repairs when unexpected events—like a fire or severe weather—destroy your merchandise and your physical space (the structure).
You need customized coverage for your record store inventory. It’s important to determine an accurate valuation of your inventory to ensure that you have sufficient coverage in the event of a loss.
You might need to insure any rare or high-value items with collectibles insurance that is available from a specialty insurer. Your independent insurance agent can help you find a carrier that specializes in the type of vintage or collectible items that you have.
Your record store insurance should also include coverage for any non-owned or partially owned items that are in your care, custody and control, but are on loan from another shop or a private record collector, or that you have agreed to insure.
Your commercial property insurance includes business interruption coverage. It compensates you for lost business income and pays for operating expenses if you must temporarily close after a covered loss (e.g., a fire damages your stockroom and part of the sales floor, and you must close your store during the rebuilding process).
What Does Record Store Liability Insurance Cover?
Record stores need insurance coverage for occasions when employees, vendors, customers, or any members of the general public visiting your store are injured or sustain property damage.
- Commercial general liability (CGL) insurance offers financial protection if a person is injured on your premises or if someone (vendor, delivery person, customer) sustains some type of property damage as a result of your operations.
If a customer trips on a cord for a vintage record player, breaks her ankle, and also drops and breaks her smartphone, this policy will cover the medical bills and the costs to repair or replace her phone.
If someone is seriously injured or harmed as a result of shopping in your store or doing business with you, it’s a distinct possibility that you’ll be sued. In these cases, your CGL policy not only pays for actual losses like medical expenses, but also pays for your legal defense, including attorney fees, court costs, and any financial payouts to the injured party.
What Other Kinds of Insurance Does My Record Store Need?
In addition to business property and liability insurance for your record store, you are likely to need a variety of additional stand-alone policies or policy endorsements. Talk with your independent insurance agent to determine if you need:
- Valuable papers coverage: Pays to reproduce valuable papers, such as financial documents, ownership records, and authenticity documentation for your vintage or rare records.
- Commercial umbrella insurance: Provides excess liability protection beyond the limits of several other policies you might have, including commercial general liability or employer’s liability.
- Employers liability insurance: Covers you if a current of former employee sues you for discriminatory employment practices.
- Workers’ compensation insurance: Pays for lost income and medical expenses for employees that are injured on the job.
- Employee crime and dishonesty coverage: Protects your business from the costs of theft, dishonesty, and fraudulent acts committed by an individual employee or a group of employees.
The Importance of Cyber Liability Insurance for Record Stores
Do you sell records or other items online in addition to your brick-and-mortar store?
If your IT security systems, antivirus software, or other online privacy efforts fail to stop a hacker who then steals company data or confidential customer or employee information, you need financial protection.
Cyber liability insurance covers your financial losses as well as third-party (customers, suppliers) damages that are caused by a cybercrime. It also typically covers your defense costs, settlements, and judgments if you are sued as a result of a cyber incident.
You can add cyber liability coverage to a business owners policy or a commercial general liability policy, or you can purchase stand-alone coverage. Your independent insurance agent can help you determine what type of coverage is best for your business.
How Much Does Record Store Insurance Cost?
A variety of factors comes in to play when determining how much your record store insurance will cost. Insurance companies evaluate your individual risk factors, such as your location, your store size, the number of employees, and the value of your inventory.
What’s more, the types of policies you need and your coverage limits have a tremendous impact on what it will cost to insure your record store.
Some small business owners can get the best rates by purchasing a business owners policy (BOP), which combines commercial liability insurance, commercial property insurance, and business interruption coverage into one affordable and efficient package policy.
Other coverage can be added on to a BOP to complete your comprehensive business insurance program.
Find and Compare Quotes
An independent insurance agent can work with you one-on-one to determine the types and amounts of coverage you need. Your agent can get quotes from multiple insurance companies so you can evaluate the cost and coverage options and make the best choice.
Benefits of an Independent Agent
Our agents simplify the search process for finding the right record store insurance. They’ll walk you through some handpicked policy options and explain the details and options.
Most importantly, they’ll be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.
The Lowdown on Online Quotes
Online quotes can be tempting. They are fast and easy to get—but are they accurate? And are you getting quotes for the right coverage? For business owners, choosing speed over accuracy can cost you.
Online quotes can’t and don’t see the whole picture. They can leave out important coverage that will leave you devastated if something unexpected happens. And they can leave out cost-saving opportunities that an agent can help you take advantage of.
Instead of getting an online quote, find an independent insurance agent now, and get one-on-one consultation and affordable options for the best coverage for your unique needs.