Novelty Stores Insurance – Cost and Types Of Policies

Whenever you budget the expenses of your business, novelty stores insurance must be high on the list because you can’t always know exactly what could happen in the future.

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With the protection provided by insurance against accidents and all the other kinds of insurance we will tell you about, you can protect your business and yourself in case something unexpected happens.

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

Business Insurance for novelty stores

If your novelty stores business runs without proper insurance, you are taking an enormous chance not just of losing some money but of a total wipe-out.

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

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

The question is, can you afford to NOT have insurance for your novelty stores business?

What this means, for any novelty stores business owner, is that if some customer 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 novelty stores business is not sheltered by laws in the same way as states are, where edicts 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 privilege of the jury to award whatever amount they deem appropriate, even sometimes giving a person more than they have sort.

When you are running your novelty stores operations, you can’t deny responsibility for the results of your actions.

Even more importantly, unless you have spent in advance the money necessary to have your business running as a corporation, all of that liability belongs to you as a person.

What does novelty stores insurance protect you from?

For your novelty stores business, the most important kinds of insurance are meant to cover the risks to your business from accidents, from unexpected events, and from mistakes.

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

In the next few paragraphs, we will outline the most important points any novelty stores business owner should know when negotiating the insurance needed.

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

Liability insurance

General liability insurance

Any novelty stores business is dealing directly with customers, and that means you always have the danger that some accident can happen to them bodily or else something of theirs can be ruined.

In such a case, they can sue you for compensation.

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

It protects your novelty stores business from the claims themselves and also to any associated court costs and legal fees of the lawsuits.

In many cases, it will even 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 novelty stores business would be with a upper limit of $1 million for a single claim 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 novelty stores insurance operations.

Professional liability insurance for your novelty stores business

In the event where a buyer alleges some negligence, errors, or omissions in how you conducted your novelty stores business for them, you can quickly be involved in a court case.

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

Every small novelty stores business should have enough professional liability insurance to cover a once-off claim of $25,000, with annual cover of $50,000.

See the table in the cost of novelty stores insurance section below for average prices of professional liability insurance for your novelty stores 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 what you delivered didn’t meet your description of function, or that your advice was basically incorrect.

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

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

To cover yourself against any likely lawsuit, you need Product liability insurance for novelty stores

Only you can know exactly how much insurance you need.

Best advice is to talk to experienced insurance agents, brokers or company representatives for support.

Commercial insurance

Commercial vehicle insurance for your novelty stores business

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

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

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

As well, in case of any accident, the car itself, the content and any legal bills, medical expenses, and property damage is covered if your car is involved in an accident.

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

The wanted value of the insurance is calculated on the depreciated value of the vehicle, and your requested level of cover of contents. 

Tools and Equipment insurance

Since your novelty stores business needs specific and expensive equipment, you know how much it can cost to replace it in case of any damage, loss, or theft.

The gear 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 unique gear quickly out of your own pocket, you must have full-level equipment insurance so that you can immediately buy any equipment needed to keep your novelty stores 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 novelty stores business’ equipment.

Commercial Property insurance

Any novelty stores business that owns or rents space in a building should have a commercial property insurance policy.

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

Your physical building location needs to 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 novelty stores business operates in areas of high risk, like California or North Carolina, extra coverage may be needed for earthquakes and hurricanes or tornadoes.

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

Because 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 novelty stores insurance section below to give some idea of the average prices per million dollars of property insurance for your novelty stores business.

Temporary insurance by month, week or day for your novelty stores business

Is your novelty stores business working part-time or casually, or is the level of business variable?

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

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

The essential feature of short-term insurance is that you purchase the cover for a defined period – a nominated 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 increased.

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

Business Owners Policy BOP for your novelty stores business

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

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

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

It is often the right choice for small and medium-sized novelty stores businesses, such as yours.

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

BOPs cannot cover your professional liability or commercial vehicle risks.

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

The normal business that is eligible for a BOP policy must have fewer than one hundred employees, and not more than five million dollars in annual revenue.

In addition, you must separately take out the required worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your novelty stores business employees

In most states, it is mandatory to have workers compensation insurance when your novelty stores 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 requirements in this regard can leave you as the employer required to pay penalties levied by the states.

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

In these states, you can’t get your workers compensation obligations from private insurance providers.

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

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

Average costs of these types of insurance

Although every novelty stores insurance need is unique, there are enough examples of standard quotes from insurance companies for us to give rough guidelines, including what are the cheapest rates offered.

Of course, you should always check with a broker what’s relevant for your business.

The list below is of annual premiums we have gathered for the main types of insurance your novelty stores businesses needs.

Types of insurance Price range
Commercial insurance $810 – $2410
Product liability insurance $325 – $650
Public liability insurance $255 – $720
Equipment insurance $320 – $1160
Commercial vehicle insurance $1605 – $3330
General liability insurance $575 – $1230

Cost of insurance for your novelty stores operations depends on many different factors.

We have reckoned these figures for small freelance novelty stores businesses.

In larger states like New York, premiums are generally about 20%-30% higher than national averages, while in smaller states like Oregon, they will be about 20%-30% less.

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

You should talk to 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 town.

FAQ

What is small business insurance for novelty stores operations?

This is an umbrella term used to describe common insurance policies designed to protect novelty stores business owners from risks like bodily injury, property damage, claims of negligence.

Does my novelty stores business have to have insurance?

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

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

What does a small novelty stores business insurance policy cover?

Liability insurance provides protection against lawsuits or claims filed by a third-party 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 most common policies for novelty stores insurance.

How much will novelty stores business insurance cost?

As well as the size of the business, certain other factors, such as location and claims history, are used to determine your policy’s cost.

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

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

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