How's it going everybody. Today I wanted to talk about insurance for grocery stores and some of the specific coverages that you should be looking into and considering to make sure that your business is properly protected.
My name is Brian. I'm an independent insurance agent based here in the state of Michigan, metro Detroit specifically, and I work with businesses on their commercial insurance programs as well as helping families and individuals with their personal insurance — their home, their auto insurance as well.
Property Insurance
This would include coverage for the building if you own it, as well as all of the business personal property — so the contents of the building. Think of things like shelving, refrigeration units, freezers, and even things like cash registers. And if you lease the space, you should also be thinking about tenant’s betterments and improvements coverage if you made any changes or updates to the property yourself. This would provide coverage for those updates and modifications.
Stock and Spoilage Coverage
For grocery stores, stock coverage is obviously vital. This would protect your inventory, especially perishable items, from loss or damage. So if your refrigeration equipment fails or there’s a power outage, spoilage coverage would step in to provide coverage for any of the lost inventory.
General and Product Liability
General Liability Insurance is crucial. This would protect your business from common risks like slip-and-fall incidents, which can happen in a wet or crowded aisle. Typically included in this is Product Liability, and this would cover claims related to foodborne illnesses or contaminated products sold in your store. If your store sells alcohol, you’ll also need to consider Liquor Liability Coverage — this helps address coverage related to alcohol sales.
Workers Compensation Insurance
If you are running a store, you're going to have employees. This is where Workers Compensation comes into play. In Michigan, it is required by law to carry this insurance. It would provide coverage for medical expenses, lost wages, rehab services if one of your employees is injured or gets sick while on the job — whether it's something like they’re stocking shelves, cleaning the aisles, or just running checkout — workers comp can provide coverage for those injury incidents.
Employment Practices Liability Insurance (EPLI)
Another critical coverage around employee-related claims is Employment Practices Liability Insurance, also known as EPLI or EPL. This coverage helps protect against employment-related claims such as harassment, discrimination, wrongful termination — and these can all be big concerns in retail environments with some higher turnover.
Commercial Auto & Hired/Non-Owned Auto Insurance
If you offer delivery services or there are any vehicles titled in the business name, Commercial Auto Insurance is also going to be very important. And it's also important to make sure around this coverage that you have Hired and Non-Owned Auto Insurance. If employees use their vehicles for any sort of work-related tasks, you will want to make sure that you have this coverage in place. If you don't have a specific commercial auto policy, you can typically include this on your general liability.
Equipment Breakdown Coverage
Another extremely important coverage is Equipment Breakdown. This helps your business repair or replace critical systems like refrigeration units and HVAC systems if these systems ever fail. But it is important to know that this doesn’t simply just cover wear and tear and overall use of the system.
Business Interruption Insurance
This is an extremely important coverage to have nowadays because if your store ever has to shut down temporarily due to a covered claim — a covered event such as with a fire or a severe storm — this coverage helps replace your lost income during that time period.
Utility Services Interruption Coverage
To take this coverage a step further, Utility Services Business Interruption Coverage is also something very worth looking into. It can provide added protection if your store isn’t in operation due to something like a water or power outage.
Cyber Liability Insurance
Another coverage that is becoming very, very common and important to have in today’s world is Cyber Liability Insurance. If your store is relying on electronic payments whatsoever, and obviously it’s going to have some form of IT system that is helping the business run, cyber insurance is critical. It can help protect against data breaches, ransomware attacks, and other cyber threats that could not only impact your business but also potentially any of your customers as well.
Crime Insurance
Another important consideration for any sort of retail business is Crime Insurance. This can cover claims related to employee theft, shoplifting, and robberies — which obviously, again, given a retail environment, is very important to have and consider.
Umbrella Insurance
An insurance coverage that every business should consider — but especially those in grocery and in retail environments — is Umbrella Insurance. This would provide an extra layer of liability coverage on top of your existing policies like your general liability, your workers comp, your commercial auto. This coverage is very important for any sort of catastrophic claims where somebody maybe is severely injured, there’s a huge lawsuit, and the claim exceeds your primary policy limits. This umbrella coverage is for those extreme worst-case scenarios that your business could potentially face.
Special Endorsements for In-Store Services
For stores with any sort of unique operations like bakeries or onsite in-store cafés or restaurants, you may want to look into specific endorsements or other specialized liability coverages as well.
Running a grocery store obviously comes with its own complexities and responsibilities, so making sure that you have the right insurance coverage in place for your business can be extremely important and give you the peace of mind to run your business confidently.
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