Consignment stores are retail establishments that sell used items on behalf of individual owners. To protect their business, consignment store owners should purchase general liability, property and business interruption insurance. Additional coverage may be needed depending on the type of merchandise the consignment store sells and the services it provides.
Who Needs Consignment Store Insurance?
All businesses that operate a consignment store, flea market, or any other type of second-hand goods store should purchase consignment store insurance. This type of insurance provides protection for businesses in the event that they are sued or experience a financial loss due to a customer’s item being damaged, stolen, or lost. It also provides coverage for any claims of negligence on the part of the business.
Types of Consignment Store Insurance
1. Commercial Property Insurance: This type of insurance covers the physical property of a consignment store, such as the building, inventory, furniture, and fixtures. It also covers any loss or damage caused by fire, theft, vandalism, and other incidents.
2. Business Interruption Insurance: This type of insurance covers any losses that the store may suffer due to a disruption in business operations. This could include lost income, relocation expenses, and other costs associated with getting the business back up and running.
3. Product Liability Insurance: This type of insurance covers any claims made against the store due to a product defect or injury caused by a product sold in the store.
4. Professional Liability Insurance: This type of insurance covers any claims made against the store due to negligence or errors made while providing services.
5. Workers’ Compensation Insurance: This type of insurance covers any medical costs and lost wages if an employee of the store is injured on the job.
6. Cyber Liability Insurance: This type of insurance covers any losses due to a data breach, such as identity theft or the loss of customer information.
How Much Does Consignment Store Insurance Cost?
The cost of consignment store insurance will vary based on the size and location of your store, the type of merchandise you sell, and the amount of coverage you need. Generally, small consignment stores will pay between $500 and $1,500 per year for basic coverage, while larger stores may pay up to $3,000 or more per year.
Consignment Store Insurance Requirements
Consignment store insurance requirements vary by state and by the type of business. Generally, consignment stores should have liability insurance, property insurance, and workers’ compensation insurance. Depending on the type of goods being sold, a consignment store may also need product liability insurance, cyber liability insurance, and professional liability insurance. Additionally, consignment stores may need to have special endorsements for certain types of items, such as antiques and collectibles.
Commercial Insurance And Business Industry Classification
- SIC CODE: 5932 Used Merchandise Stores
- NAICS CODE: 453310 Used Merchandise Stores
- Suggested Workers Compensation Code(s): 8017 Store – Retail NOC
Consignment Store Insurance – The Bottom Line
Consignment store insurance is a must for any consignment store owner. It will protect you from potential liability and cover your property in case of damage or theft. Make sure you do your research and understand the coverage that is right for your specific store. With the right policy, you can rest assured that your business is protected in the event of an unexpected incident.