Why is insurance a must for furniture stores?
With the level of inventory and showroom merchandise a furniture store carries, a serious event like a burst pipe could shutter your shop. With the right furniture store insurance, your business will be protected from property damage, theft, lawsuits, and injuries.
Find coverage that matches your risks
6 insurance policies every furniture shop should consider
Business insurance can help stores recover quickly from common risks in the retail industry.
Business owner's policy
A BOP is an insurance package that combines general liability coverage and commercial property insurance at a discount. You can also add business income insurance to a BOP as an endorsement.
- Slip-and-fall injuries
- Damage to a customer's property
- Business property damage and theft
General liability insurance
A general liability insurance policy defends against third-party lawsuits, such as a customer who stumbles into a jewelry display and suffers an injury. It's often required for a commercial lease.
- Customer bodily injuries
- Accidental damage to a customer's property
- Advertising and copyright infringement lawsuits
Workers' comp insurance
Workers' compensation insurance protects retail stores and sole proprietors from work-related medical bills that health insurance won't cover. Most states require this coverage for your employees.
- Medical expenses from work-related injuries
- Disability benefits for injured workers
- Legal costs from work injuries
Cyber insurance
This liability policy covers the cost of cyberattacks and data breaches that expose customer information and credit card data. It's also called cyber liability insurance or cybersecurity insurance.
- Data breach investigations
- Customer notification costs
- Fraud monitoring services
Commercial umbrella insurance
This policy covers costly lawsuits that exceed the limits on your general liability, commercial auto, or employer's liability insurance. It activates when the underlying policy reaches its limit.
- Customer injuries
- Auto accidents
- Employee injuries
Commercial auto insurance
Almost every state requires commercial auto insurance for business-owned vehicles. It covers costs in the event of an accident involving a delivery truck or other company vehicle.
- Legal fees from an auto accident
- Vehicle vandalism
- Vehicle theft
Furniture store insurance costs
From our customer data, here's a quick look at average furniture store insurance costs:
General liability: $57 per month
Business owner's policy: $106 per month
Workers' compensation: $140 per month
Factors that can influence your retail business premiums include:
- Type of business, such as e-commerce or brick and mortar
- Number of employees
- Types of furniture sold
- Value of your business property
- Types of insurance purchased
- Deductibles, exclusions, and coverage limits
- Claims history
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Common questions about business insurance for furniture stores
Review answers to frequently asked questions (FAQs) about furniture store insurance policies and more.
Will property insurance cover my furniture store if it's forced to close temporarily?
Business interruption insurance, also called business income insurance, can easily be added as an endorsement to many commercial property policies and business owner's policies. This coverage helps provide financial relief for small business owners during a temporary closure.
Should your furniture business be forced to close due to a covered peril, such as a fire or storm, business interruption insurance can help temporarily pay:
- Employee wages
- Lost income
- Day-to-day operating expenses
- Relocation expenses
You can also buy extra expense insurance to cover additional costs, like leasing a piece of equipment or hiring interim employees.
The money you lose while your store is closed could end up costing even more than the damage itself, which is why this coverage is so important.
Why is product liability insurance crucial for furniture stores?
While not a mandated policy, any store that sells or distributes home goods needs product liability insurance. A customer lawsuit alleging they were harmed by a product or furniture item your store sold could financially devastate your home furnishings business.
For furniture stores, there are a host of allegations a customer can claim, including:
- Design defects due to an inherently defective furniture design
- Manufacturing defects from a flaw in the manufacturing process
- Failure to offer complete warnings or provide adequate instructions
- Misrepresentation of information on the product or furniture item
- Negligent or wrong assembly of furniture that caused harm
- Premises liability where a retailer disregards customer safety over a known issue
This policy is especially critical for furniture businesses that sell children's furniture as kids are prone to climb, play, and jump on furniture. Should you sell a child's dresser that didn't come with adequate wall anchors and it falls and injures a child, your business could be held liable for their medical bills, as well as a financial settlement.
Even though you didn't manufacture the furniture, because you sold it you're just as liable to the claim. That means you could end up paying legal defense costs for a product defect or labeling error that wasn't your fault.
While this coverage is usually included in most general liability and business owner's policies, you can also buy product liability insurance as standalone coverage.
Additionally, you should also consider product recall insurance to cover the cost of recalling a potentially harmful product.
Does furniture shop insurance cover theft of property?
Commercial property insurance, which is included in a BOP, insures your furniture business against theft and burglaries. However, it only protects against crimes committed by third-parties. Furniture store owners should also consider employee dishonesty coverage, such as:
- Commercial crime insurance protects your business in the event of employee theft, such as a salesperson who steals from the cash register. You can usually add it to your property insurance.
- Fidelity bonds protect your customers from the acts of dishonest employees, such as identity theft or an unauthorized electronic funds transfer. Unlike insurance, the bond reimbursement for the amount stolen must be paid back to the company that issued the bond.
What other insurance coverage do furniture businesses need?
Small business owners should consider the following types of home furnishing store insurance to protect against other risks that could potentially cause devastating damage:
- Commercial property insurance, best purchased in a business owner's policy, commercial property insurance protects your inventory, cash register, and other business property from theft, fire, and similar incidents.
- Equipment breakdown coverage covers specialized equipment that suffers a failure due to uncontrollable circumstances, such as a recently purchased POS system that stops working suddenly.
- Electronic data processing (EDP) insurance handles any related financial losses when a power surge or other event destroys the data in your computer systems.
- Inland marine insurance provides coverage for business property, such as sofas, dressers, and other goods, while it’s in transit over land or stored at an off-site location.
