Shop Insurance UK - Shop Insurance is usually purchased on a Package basis. It is obtainable from Insurers direct and from Brokers & Intermediaries.  Most Shop Insurance policies will offer you a “ core” of covers to which you can then add additional covers if they are pertinent to your requirements, for example a proprietor of an Office Licence may wish to add Licence Protection cover or the proprietor of a grocery shop may wish to add frozen food cover to his Shop insurance package.

Shop Insurance Rating - Your quotation will depend on a number of factors such as the location of your premises, as with Home Insurance, the postcode can have a bearing on the premium with inner city areas attracting the highest rates. The insurers will also want to know what you sell as this again will have an influence on the premium. The higher the value of your stock, the more expensive your premium, also the type of stock you sell will also influence the premium, someone selling high risk stock such as Alcohol or Electrical goods or designer clothing will pay a higher premium than someone selling flowers. Also tell the insurer exactly what you do, if there is any element of manufacturing at your premises or you do any work away, make sure this is declared so as the correct cover can be provided. As with all types of insurance, always give the insurers the full details in order that your shop insurance can be as accurate as possible.

Shop Insurance Security - You may also find that the insurers require you to have certain security measures in force at your premises and you must pay close attention to this as this may affect the validity of any claim. Good physical securities are always important and in some cases you may have to fit your shop with an Alarm, if this is the case, normally the broker or insurer will give you the alarm specification at the time of quotation. In some cases you may even be asked to fit Bars or Shutters to your Shop premises.

Terms & Conditions - All shop insurance policies come with terms & conditions and exclusions and these will need to be studied closely, certainly if your shop premises is a catering establishment, strict requirements are included with regard to the cleaning of equipment to prevent fires etc.

The covers available - The covers normally available under a Shop Insurance policy will vary from insurer to insurer but the following sections are fairly typical:-

• Buildings

• Contents

• Business Interruption

• Public Liability

• Products Liability

• Employers Liability

• Money

• Personal Accident

• Personal Assault

• Book Debts

• Fidelity Guarantee

• Business Legal Expenses

• Freezer Contents

• Licence protection cover

• Goods in Transit cover

The first seven covers on the list tend to be the “core” part of the wording with the rest being offered as optional extras. The actual type of cover on offer is usually “ Fire & Special Perils or the wider All Risks basis. All Risks is by far the most popular type of cover today. You can expect the following perils to be fairly standard under an insurance policy;

Fire, lightning, explosion, subterranean fire, earthquake Aircraft or other aerial devices or articles dropped from them. Riot Civil commotion strikers locked out workers or persons taking part in labour disturbances or malicious persons.  Storm Tempest or flood bursting or overflowing of fixed water tanks apparatus pipes or fixed oil fired heating installations. Impact by any road vehicle or animal.)  Falling trees Breakage or collapse of television or radio aerials dishes, fittings or masts. Theft or attempted theft. Accidental physical Damage caused any event not excluded in the policy list of exclusions. Subsidence or ground heave of any part of the site on which the Premises stand or landslip.

The above are fairly standard perils under the Buildings & Contents section of a shop insurance contract. Whatever cover you decide to accept whether it is Fire & Perils or All Risks, cover under the Business Interruption section will follow the same basis of cover.

Business Interruption under Shop Insurance - Business Interruption is a very important cover and one that not too many people actually consider that carefully. Of course if you have a loss at your premises, the insurance will cover you if it is an insured peril, but what if the loss is quite severe and you are unable to trade for several months. This section of your policy will pay for your loss of profits during the period that you are unable to trade.  Some package policies will give you a sum insured that is quite high and may offer you the cover over 12 24 or 36 months, even if the sum insured is provided for you, it is still a good idea to make sure that your sums insured are adequate. For this type of cover Business Interruption is usually calculated on a Gross Profit basis and a very simple way of calculating your sum insured is as follows.

Sales (turnover) + Closing Stock - Purchases & Opening Stock - So if you turnover over £125,000 per annum and at the end of your 12 month trading period you have £15000 stock you subtract the amount you have spent on buying your stock say £65,000 and the stock you have at the present moment say it is £10,000.  This will give you a gross profit of £65,000.

Liabilities - Under a Shop Insurance policy, Liabilities form part of the core wording but make sure you keep the insurer fully informed of what you are doing. Always fully declare all of your business activities relating to the shop and make sure your inform the insurers if your shop exports any goods overseas.

Money - Most insurers will give you a set limit for money on a scale basis; if you carry a lot of cash to the bank they may impose certain carrying restrictions. Make sure you study the rules most carefully, in particular requirements for a safe and any overnight requirements.

Personal Accident Insurance - This section of the policy can be included for both the proprietor and directors and members of staff if required. Personal Assault covers tends to be included under the money section of the policy.

Book Debts - This section of the shop policy is not as popular as it was, it will provide a payout if you suffer a financial loss as you are unable to proves what money is owed to you, Nowadays, with computer records most companies have a back up of all monies outstanding to them.

Fidelity Guarantee - You can add this section to your shop insurance policy to protect you against Theft by employees.

Business Legal Expenses - This section of the policy will usually provide a 24-hour legal helpline and provide cover for such things as employment disputes, taxation problems, problems with suppliers etc. 

As with all types of insurance it pays to shop around but pay special attention to any insurers Key Facts document, study the cover on offer. You may find that you are able to secure a discount on your Shop Insurance if you have good security at your premises