Dry Cleaners Insurance – What Kind and at What Cost

Whenever you budget the expenses of your business, dry cleaners insurance must be high on the list because you can’t always know exactly what is going to happen in the future.

With the protection provided by general insurance and all the other types of insurance we will tell you about, you can protect your business and yourself in case something unwanted happens.

Like any business owner, for your dry cleaners enterprise, you must consider how much financial risk you are taking on.

If your dry cleaners business runs without proper insurance, you are taking a giant chance not just of losing some money but of a complete wipe-out.

This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the results of their actions. 

In this article, we are giving very general guidelines for growing businesses to explain what the main kinds of insurance that you need are, and where available, a rough guide to how much you can expect to pay.

The question is, can you afford to NOT have insurance for your dry cleaners business?

What this means, for any dry cleaners business owner, is that if some company claims that your work caused them some physical or economic damage, a court can award damages far beyond the total size of your business.

Your dry cleaners business is not protected by laws in the same way as states are, where legislation can place a “cap” on the maximum level of liability.

In some states, like Texas, there are specific monetary levels that limit the amount a judge can award in any case against the state.

In a court case, it’s purely the duty of the jury to award whatever amount they deem appropriate, even sometimes giving a claimant more than they have sued for.

When you are running your dry cleaners operations, you can’t escape responsibility for the outcomes of your actions.

Even more importantly, unless you have spent beforehand the money necessary to have your business running as an LLC, all of that liability belongs to you as an individual.

What does dry cleaners insurance protect you from?

For your dry cleaners business, the most important types of insurance are intended to cover the risks to your business from accidents, from unexpected events, and from mistakes.

Also there are some mandatory kinds of insurance that various states require.

In the next few paragraphs, we will outline the most important points any dry cleaners business owner should remember when negotiating the insurance needed.

The main headings of insurance for your dry cleaners businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.

Liability insurance

General liability insurance

Any dry cleaners business is dealing directly with other people, and that means you generally have the danger that some accident can happen to them personally or else something of theirs can be spoiled.

In such a case, they can require compensation.

General liability insurance policy for your dry cleaners business insures you against claims coming from injury to customers or damage to their property.

It protects your dry cleaners business from the claims themselves and as well to any follow-on court costs and legal fees of the lawsuits.

In many cases, it should help you to qualify for extra business from city and state organizations, where contracts demand proper liability insurance.

The normal level of general liability insurance for your dry cleaners business would be with a cap of $1 million for a single event and a total of $2 million for the whole year.

See the table in the costing section below for average prices of general liability insurance for your dry cleaners insurance operations.

Professional liability insurance for your dry cleaners business

In the event where a buyer alleges some negligence, errors, or omissions in how you conducted your dry cleaners business for them, you can quickly face a law suit.

Even if the case against you is decided in your favor, the cost of defense can be large, and the impact on your reputation can be damaging.

Most small dry cleaners business should have enough professional liability insurance to cover an individual claim of $25,000, with annual cover of $50,000.

See the table in the cost of dry cleaners insurance section below for average prices of professional liability insurance for your dry cleaners operations.

Product liability insurance

Whatever goods you sell or advice you give about the goods, you are running a risk that customers may claim that the results didn’t meet your description of function, or that your advice was basically incorrect.

You need to understand the particular laws of product liability in your own state.

For example, in California, all businesses in the supply chain can be held responsible for injuries caused by products claimed to be defective.

To cover yourself against any following lawsuit, you need Product liability insurance for dry cleaners

Only you can determine exactly how much insurance you must have.

Best advice is to contact experienced insurance agents, brokers or company representatives for guidance.

Commercial insurance

Commercial vehicle insurance for your dry cleaners business

Take care! – most policies for private vehicle insurance do not cover any occurrence like theft or accidental damage when the van is being used for business purposes.

The right way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a direct commercial vehicle insurance package.

Commercial car policies cover the value of any vehicle in case of accident, malicious damage, fire, or theft.

In addition, in case of any accident, the truck itself, the content and any legal bills, medical expenses, and property damage is guaranteed if your van is involved in a collision.

Most states, other than Virginia and New Hampshire, mandate this type of insurance.

The necessary value of the insurance depends on the depreciated value of the vehicle, and your intended level of cover of contents. 

Tools and Equipment insurance

Since your dry cleaners business needs specific and expensive equipment, you will realize how much it can cost to replace it in case of any damage, loss, or theft.

The tools may be subject to malicious damage, deliberate fire, theft, other such unexpected acts.

As well, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can eliminate your whole business in one stroke.

Unless you can afford to immediately replace such specific gear quickly out of your own pocket, you should have full-level equipment insurance so that you can immediately buy whatever needed to keep your dry cleaners business running.

It is impossible to advise how much equipment insurance you need – it’s basically dependent on how much you have invested in your dry cleaners business’ equipment.

Commercial Property insurance

Any dry cleaners business that owns or rents space in a building needs a commercial property insurance policy.

If you own the space, you probably have a substantial capital investment, as well as a big liability if there’s a mortgage.

Your physical building location must carry insurance coverage for the value of the premises and contents against accidental occurrences like fire and storms, and against man-made damages like theft and vandalism.

If your dry cleaners business works in areas of high risk, like Texas or Georgia, supplementary coverage may be needed for earthquakes and hurricanes or tornadoes.

In other states like Washington, where intense cold snaps can cause damage to outer coverings of dry cleaners business premises, there is a need for more supplementary cover than in warmer climes.

Whereas the level of cover depends completely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of dry cleaners insurance section below to give some indication of the average prices per million dollars of property insurance for your dry cleaners business.

Temporary insurance by month, week or day for your dry cleaners business

Is your dry cleaners business working part-time or casually, or is the level of business seasonal?

Using short-term insurance makes good sense. Business insurance by the month, day, or week – temporary insurance for dry cleaners – are special policies where you can cover a nominated period when you want to be covered.

By only paying for that period of cover, you will save by having lower premiums but still having adequate risk cover.

The important feature of short-term insurance is that you pay for the cover for a defined period – a specific date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.

When you are expecting periods of higher business activity, get the existing cover improved.

Talk to your insurance agent, broker or the company’s representatives to see what options you have.

Business Owners Policy BOP for your dry cleaners business

You have the option to combine a few of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.

A BOP merges commercial property and public liability insurance by incorporating these coverages into one insurance policy, which can save you money.

BOP insurance will cover you if any claims of injury or property damage are made.

It is mostly the right choice for small and medium-sized dry cleaners businesses, such as yours.

There are two limits that will dictate whether BOP is suitable for your own business.

BOPs cannot cover your professional liability or commercial vehicle cover.

Also, the size of your business will rule whether you are eligible to take out BOP cover.

The normal business that can take out a BOP policy must have no more than one hundred employees, and not more than five million dollars in annual turnover.

As well, you must separately take out the necessary worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your dry cleaners business employees

In many states, it is mandatory to have workers compensation insurance when your dry cleaners business has one or more employees.

Workers compensation insurance covers the business against any costs that arise if an employee experiences an injury or becomes sick as a result of work.

The benefits provide for medical expenses, death benefits, lost wages, and vocational rehabilitation.

Failure to meet a state’s regulations in this regard can leave you as the employer having to pay penalties levied by the states.

Some states, such as North Dakota, Ohio, Washington, West Virginia, and Wyoming only authorize coverage from the government-run monopoly state funds.

In these states, you cannot obtain your workers compensation obligations from private insurance providers.

Workers compensation charges are computed based on the employee’s pay, and usually come out at around $1.00 per $100 per month.

However, you must consult the relevant authorities in your state.

Average costs of these types of insurance

Although every dry cleaners insurance level is unique, there are enough examples of average quotes from insurance companies for us to give rough guidelines, including what are the cheapest rates offered.

Of course, you should always check with an insurance representative what’s relevant for your business.

The list below is of annual premiums we have researched for the main types of insurance your dry cleaners businesses needs.

Cost of insurance for your dry cleaners operations depends on many different factors.

We have reckoned these figures for small independent dry cleaners businesses.

In larger states like Texas, premiums are generally about 20%-30% higher than national averages, but in smaller states like Oregon, they can be about 20%-30% lower.

The location and size and type of your dry cleaners business can have a big effect on the cost of different policies.

You should consult with professional insurance agents and brokers, or insurance company representatives.

As well you can let the internet do the work for you by searching for insurance companies near where your business is located.

Another good source of information is the local Better Business Bureau in your suburb.

FAQ

What is small business insurance for dry cleaners operations?

This is a general term used to describe standard insurance policies designed to protect dry cleaners business owners from risks like bodily injury, property damage, claims of negligence.

Does my dry cleaners business have to have insurance?

Some of the types of insurance are not mandatory for you to operate your business, but they can protect you from risks in your business operations.

Several other forms are required by state law, such as workers compensation and vehicle insurance.

What does a small dry cleaners business insurance policy cover?

Liability insurance provides protection against lawsuits or claims filed by a client for bodily injury, property damage, or negligence.

The exact cover will vary based on your own operations.

See the table in the costing section above for average prices of the best policies for dry cleaners insurance.

How much will dry cleaners business insurance cost?

In addition to the size of the business, some other factors, such as location and claims history, are used to determine your policy’s cost.

You should consult with professional insurance agents and brokers, or insurance company representatives.

You can search for more information insurance for dry cleaners, in the search box below, and follow the relevant links.

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