It’s not only birthday parties, weddings, and baby showers that are top-of-mind for a party supply store owner. While helping people make memories and celebrate the best of times is your reason for being in business, you still need to protect your livelihood from all of the little things—and big things—that can go wrong.
Property damage and lawsuits can cost you a ton of money and even put you out of business. If you own a party supply store, 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.
With the right party supply store insurance, you can put your mind at ease and focus on what’s important. Business insurance tailored to your unique risks can help you recover from simple claims for slips and falls, and even from complete devastation caused by a fire or severe weather.
Why Do I Need Party Supply Store Insurance?
It’s simple: Party supply store insurance helps you avoid financial ruin 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 (party decorations, invitations, plates, cups, and cutlery) 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)
- Equipment damage or breakdown (a helium tank malfunctions and is unusable)
- Employee theft of cash or inventory
- Delivery drivers involved in automobile accidents
- Selling faulty products (improperly labeled products that present a child choking hazard or allergy hazard)
- Employee lawsuits related to discrimination or other claims
- Cyber breaches (data breaches of your online store)
- Fire damage to your landlord’s property
What Does Party Supply Store Insurance Cover?
Party supply store insurance should cover the unique risks you face in your line of business. This includes physical damage to your building or property, as well as your responsibility to financially compensate any customers or members of the public that get injured on your property or as a result of buying something from you.
With a few commercial insurance policies tailored to your needs, you can get the peace of mind you need to focus on the important stuff—like helping your customers throw the greatest bridal shower ever, or the most epic graduation party in recent memory.
Working closely with an independent insurance agent, you can determine exactly what risks you have and find tailored insurance policies to address them. You may need:
- Property coverage for buildings and their contents, such as computers and cash registers, inventory, equipment, furniture, fixtures, and more. Commercial property insurance helps you rebuild or make repairs when unexpected events—like a fire or severe weather—destroy your merchandise and your physical space (structure).
- Business interruption coverage, which compensates 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).
- Liability coverage, which pays for claims of bodily injury and property damage to third parties due to your negligence (e.g., an employee leaves a ladder unattended while stocking shelves and a child climbs the ladder, falls, and is injured).
If you operate a single store or even several stores, you may be able to bundle your basic property and liability coverage together into a packaged policy (business owners policy, or BOP) designed for small business owners.
You might also want to consider endorsements to your basic party supply store insurance policies or stand-alone policies that provide the following types of coverage:
- Commercial umbrella insurance provides excess liability protection to any of several other policies you might have. If a customer injury in your store leads to an expensive lawsuit that exceeds the limits of your commercial general liability policy, your commercial umbrella policy kicks in with higher coverage limits.
- Commercial auto insurance ensures that you’ll be able to pay for any physical damage or injuries you cause if you are in an auto accident while driving for business purposes. If you deliver balloons or other party supplies, pick up rented equipment after use, or even simply run business-related errands using a business-owned vehicle, you need commercial auto insurance.
- Workers’ compensation insurance is typically required for any business that has employees. It pays for lost income and medical expenses for employees who are injured on the job. If a cashier, stock person, store manager, or any other type of employee is injured while lifting heavy boxes, slipping on a wet floor, or falling off of a ladder, workers’ compensation insurance pays for related medical costs and compensates the employee for time away from work.
- Crime coverage protects your business if an employee or a group of employees engage in theft, forgery, or fraud that damages your business.
- Equipment breakdown coverage pays for costs associated with sudden and accidental breakdown of machinery and equipment, such as any equipment used to blow up balloons. It covers the costs to repair or replace the equipment and any other property that is damaged by the broken equipment. It also reimburses you for related business interruption costs (your lost business due to your inability to sell helium balloons while the equipment is being repaired or replaced).
- Inland marine coverage is another form of property insurance that protects your equipment, tools, portable computer equipment, tables, chairs, tents, or any other inventory while it is in transit (e.g., out for delivery or pickup for a rental arrangement).
- Sign coverage pays for damage to outdoor signs that are not attached to your building when the damage is caused by weather, vandalism, fire, etc.
- Utility interruption coverage provides income protection if you are unable to operate due to a covered utility (water, electrical) interruption.
Why Do Party Supply Stores Need Product Liability Insurance?
Party supply stores sell all kinds of products to the general public, from tablecloths and paper goods to helium balloons, toys, party favors, candy, costumes, and much more.
You probably purchase your inventory from a variety of suppliers and manufacturers, but you do not need to manufacture a product to be considered liable if a product causes some type of property damage, illness, or injury to a customer or bystander.
If any product that you sell is faulty and leads to an injury or death, your business could be sued for negligence. Imagine that you sell a party favor that presents a choking hazard to children, but it is not labeled as such and children are injured as a result.
Or perhaps you sell candy that includes an ingredient like nuts, which is a common allergen, but it is not properly labeled and someone becomes severely ill after purchasing it in your store and eating it.
Product liability insurance covers your financial responsibility for losses or injuries to a user, buyer, or bystander caused by a defect or malfunction of a product purchased in your store.
If you are sued in such a case, the resulting payouts for medical costs, compensatory damages, economic damage, attorney fees, court costs, and even punitive damages can be insurmountable for a small business.
Talk to your independent insurance agent about your need for product liability insurance.
The Importance of Cyber Liability Insurance for Online Party Supply Stores
Do you sell items online in addition to your brick-and-mortar store? Talk to your independent insurance agent about the special risks you face and how cyber liability insurance can help.
In general, cyber liability insurance protects you from the costs related to certain cybercrimes. If someone hacks into your website, steals personal financial data from you or your customers, or causes any other type of damage, cyber liability insurance helps to cover money lost and helps to pay for damages caused to your customers.
Regardless of how a data breach happens, the costs can be devastating for your business. Just some of the costs associated with a data breach include:
- Legal requirements to notify individuals or business partners that their data may have been exposed
- Public relations costs necessary to repair your reputation
- Investigative costs to determine exactly how the breach happened and whose data has been exposed
- Loss of income and business interruption caused by the breach
- Providing credit monitoring services for those affected by the breach (e.g., for clients whose data was compromised)
- Loss of income or business interruption for a client or partner
- Ongoing public relations impact and loss of future business
Cyber liability insurance typically covers defense costs, settlements, and judgments related to a cyber liability lawsuit. Cyber liability insurance also covers public relations and other related expenses that you incur in order to salvage your reputation.
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 Party Supply Store Insurance Cost?
A single-location party supply store might spend around $500 to $1,500 per year on general liability coverage alone.
But this is a broad estimate and does not include property coverage and any other types of policies or endorsements that you might need to fully cover your risks.
In addition, a variety of individual risk factors will influence how much you pay to cover your party supply store. These include the location of your store, the number of employees you have, and the coverage limits and deductibles that you choose.
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 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 party supply store insurance. They’ll walk you through the 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.
TrustedChoice.com Article | Reviewed by Paul Martin
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