Clothing Store Insurance

Clothing Shop Insurance

Clothing stores of all shapes and sizes should be covered against the risks they face with clothing shop insurance.

Clothing Business Insurance

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Clothing Shop Owner

Insurance for clothing business

Running a clothing store may not seem like a risky venture, but high foot traffic and holding a large amount of inventory can up the stakes considerably. If a customer is injured on your premises, you can be held legally responsible. Additionally, if there is a break-in, you could lose thousands of dollars worth of stock in a matter of moments. Instances like these are, unfortunately, not uncommon. 

However, with the right insurance policy, you’re free to focus on growing your clothing empire rather than worrying about what could go wrong.

Clothing store insurance is a policy that’s customized for clothing shop business owners. It combines several policies to provide comprehensive coverage for the risks that can be faced when running a brick-and-mortar retail business.

A clothing shop insurance policy is designed to cover the many risks you may encounter, including liability claims and loss or damage to your property. Here are the coverages that most clothing shop insurance policies include:

  • Commercial General Liability (CGL) Insurance: Also known as “slip-and-fall” insurance, CGL covers clothing store owners against the common liable risks. If a third party is injured, or their property is damaged on your premises, they could hold you liable for loss. Let’s say it’s a rainy day, and a customer trips and falls while entering your store. In the fall, they drop their expensive phone which breaks and they injure their hip. In this case, CGL could cover third-party medical bills and the cost to repair or replace their phone.
    • Product Liability Insurance: CGL may include product liability coverage to protect you against third-party injuries or property damage that are caused by defective products you sell.  For example, a customer buys a bright red dress from your store. A week later they complain that after wearing it the dye has stained their skin and their expensive white handbag. They sue you for damages. Product liability insurance may cover the costs to replace or repair their handbag and any other related costs.
  • Commercial Property Insurance: Commercial property insurance protects your premises and your contents (such as business equipment and inventory) from certain risks, like fire, theft, and vandalism. Suppose your store is broken into while you take a week off to go on vacation. When you return, a significant portion of your inventory is missing from the stock room and certain equipment, such as your cash register, has been damaged during the theft. Commercial property damage could cover the costs to replace stolen inventory, repair or replace broken equipment, and cover the additional costs to restore security measures.
    • Business Interruption Coverage: This coverage is often included under a commercial property insurance policy. Business interruption insurance can provide financial reimbursement for lost income following an insured event. For example, if you had to close your business for a week for repairs following an insurable loss such as a burglary. Business interruption may cover your estimated lost income (based on previous financial data).
  • Cyber Liability Insurance: Unfortunately, cyber-attacks and other data breaches are becoming more common. Cyber liability insurance is an important coverage that protects your liability against attacks on personal data that’s stored electronically in your network. For example, financial data is stored in a point-of-sale (POS) system. If you’re affected by a cyber-attack, cyber liability insurance can cover legal fees, third-party notification costs and the costs to restore data protection.
  • Legal Expense Insurance: This insurance provides legal coverage in situations where you’re not already covered for legal assistance from another insurance policy (for example, legal assistance needed for an employee injury or property damage to your property). With this coverage, you can be reimbursed for the costs of legal advice or retaining legal representation.
  • Commercial Crime Insurance: Also commonly known as fidelity insurance, commercial crime insurance protects business owners from a loss of funds (e.g., cash) caused by internal theft, forgery, counterfeiting or impersonation. With this coverage, you can be reimbursed for the losses caused by criminal actions of employees and third parties, including customers.

Like many businesses, clothing shops come in a large variety of offerings. The price of an insurance policy depends on the factors that make your business unique:

  • Years of experience
  • Services and products you provide
  • Business size and location
  • Annual and projected gross revenue
  • Number of employees
  • Your insurance claims history

Any business with foot traffic from the general public can be susceptible to a lot of risks.

Here are some specific types of clothing businesses we can provide insurance coverage options:

  • Fashion clothing stores
  • Children and baby clothing shops
  • Menswear retailers
  • Vintage or second-hand clothing stores
  • Dressmaker and seamstress businesses
  • Tailoring business

Getting business insurance for your clothing store is quick and easy!

Complete our 5-minute online application for a free clothing store insurance quote.

Common risk scenarios for clothing store businesses

customer in fitting room

Problem: Your fitting rooms are up a few steps. A customer trips climbing the stairs, hits their head, and suffers a concussion. A lawsuit was filed against your business for injuries.

Outcome: Your commercial general liability insurance policy could cover the cost of legal fees and monetary judgement.

clothing on front display

Problem: During a severe thunderstorm, your clothing shop suffered damages to the front windows, including several articles of clothing on display.

Outcome: Your commercial property insurance could cover the costs to repair your store and reimburse the value of the damaged inventory. 

store employee at clothing shop

Problem: After looking at your security footage, you realize an employee is responsible for stealing some of your boutique, new-season stock.

Outcome: Your commercial crime insurance may cover the cost to replace the stolen inventory.

Frequently asked questions

If I manufacture clothing, do I need additional coverage?

Depending on how you manufacture clothing, you may also need equipment breakdown coverage. It can cover the costs of repairing or replacing equipment due to internal damage, such as an electrical or mechanical fault. Garment manufacturing machinery such as printing equipment and sewing machines can be covered under this policy.

Will my clothing shop insurance cover products sold online?

If you sell your clothes online or have an e-commerce store in addition to your location, you can be covered by clothing shop insurance. Make sure you disclose that information when filling out our application and you’ll be provided with suitable options and coverage limits.

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Ready to start? Let’s get a quote!

Getting clothing shop insurance has never been easier – get a free quote today by filling out our online application form. 

Have questions? No problem at all! During the application process, you can access our licensed brokers via live chat to discuss your unique insurance needs.