Whenever you budget the expenses of your business, subscription box insurance must be included in the list because you can’t always know exactly what can happen in the future.
Need General Liability Insurance for Your Subscription Box
Get Your Free Quote
With the protection provided by liability insurance and all the other types 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 subscription box enterprise, you must consider how much financial risk you are taking on.
If your subscription box 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 upshots of their actions.
In this article, we are giving very general guidelines for startup businesses to outline 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 subscription box business?
What this means, for any subscription box business owner, is that if some person 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 subscription box business is not sheltered 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 privilege 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 subscription box operations, you can’t avoid responsibility for the outcomes of your actions.
Even more importantly, unless you have spent up-front the money necessary to have your business running as an LLC, all of that liability belongs to you alone.
What does subscription box insurance protect you from?
For your subscription box business, the most important kinds of insurance are designed to cover the risks to your business from accidents, from unexpected events, and from mistakes.
As well there are some legal kinds of insurance that various states require.
In the next few paragraphs, we will outline the most important points any subscription box business owner should consider when negotiating the insurance needed.
The main headings of insurance for your subscription box businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.
General liability insurance
Any subscription box business is dealing directly with members of the public, and that means you usually have the danger that some accident can happen to them bodily or else something of theirs can be spoiled.
In such a case, they can require compensation.
General liability insurance policy for your subscription box business protects you against claims coming from injury to customers or damage to their property.
It protects your subscription box business from the claims themselves and also to any follow-on court costs and legal fees of the lawsuits.
In many cases, it can also 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 subscription box business would be with a boundary 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 subscription box insurance operations.
Professional liability insurance for your subscription box business
In the event where a customer alleges some negligence, errors, or omissions in how you conducted your subscription box business for them, you can quickly have to fight a monetary claim.
Even if the lawsuit against you is decided in your favor, the cost of defense can be substantial, and the impact on your reputation can be damaging.
Almost all small subscription box business should have enough professional liability insurance to cover a single claim of $25,000, with annual cover of $50,000.
See the table in the cost of subscription box insurance section below for average prices of professional liability insurance for your subscription box 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 they received didn’t meet your description of function, or that your guidance was basically incorrect.
You need to be aware of the explicit laws of product liability in your own state.
For example, in California, all businesses in the supply chain can be held culpable for damages caused by products claimed to be defective.
To cover yourself against any likely lawsuit, you need Product liability insurance for subscription box
Only you can determine exactly how much insurance you need.
Best advice is to talk to experienced insurance agents, brokers or company representatives for help.
Commercial vehicle insurance for your subscription box business
Beware! – most policies for private vehicle insurance do not cover any happening 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.
In addition, in case of any accident, the van itself, the content and any legal bills, medical expenses, and property damage is guaranteed if your car 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 subscription box business needs specialized and dedicated equipment, you will realize 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.
In addition, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can destroy your whole business in one stroke.
Unless you can afford to immediately replace such specialized gear quickly out of your own pocket, you must have full-level equipment insurance so that you can immediately buy everything needed to keep your subscription box 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 subscription box business’ equipment.
Commercial Property insurance
Any subscription box business that owns or rents space in a building should have a commercial property insurance policy.
If you own the space, you may already have a substantial capital investment, as well as a big liability if there’s a mortgage.
Every physical building location should 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 subscription box business works in areas of high risk, like Florida or Georgia, 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 subscription box business premises, there is a need for more extra cover than in warmer climes.
Whereas the level of cover depends mainly 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 subscription box insurance section below to give some estimate of the average prices per million dollars of property insurance for your subscription box business.
Temporary insurance by month, week or day for your subscription box business
Is your subscription box business working part-time or casually, or is the level of business variable?
Using short-term insurance makes excellent sense. Business insurance by the month, day, or week – temporary insurance for subscription box – 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 less premiums but still having adequate risk cover.
The important feature of short-term insurance is that you purchase the cover for a defined period – a designated 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 better business activity, get the existing cover raised.
Talk to your insurance agent, broker or the company’s representatives to see what options you have.
Business Owners Policy BOP for your subscription box 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 integrates 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 frequently the right choice for small and medium-sized subscription box businesses, such as yours.
There are some limits that will determine whether BOP is suitable for your own business.
BOPs will not cover your professional liability or commercial vehicle risks.
Also, the size of your business will dictate whether you are permitted to take out BOP cover.
The typical 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 revenue.
Plus, you must separately take out the mandated worker’s compensation, health and disability insurance as determined for your state.
Workers Compensation insurance for your subscription box business employees
In almost all states, it is mandatory to have workers compensation insurance when your subscription box business has one or more employees.
Workers compensation insurance covers the operation against any costs that arise if any hired hand experiences an injury or becomes sick as a result of work.
The benefits include 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 required 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 worked out 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 subscription box insurance requirement 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 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 subscription box businesses needs.
|Types of insurance||Price range|
|Product liability insurance||$230 – $860|
|Equipment insurance||$445 – $1020|
|Commercial insurance||$1190 – $2640|
|Public liability insurance||$390 – $575|
|General liability insurance||$765 – $1175|
|Commercial vehicle insurance||$1840 – $2715|
Cost of insurance for your subscription box operations depends on many different factors.
We have estimated these figures for small freelance subscription box businesses.
In larger states like New York, premiums are generally about 20%-30% higher than national averages, but in smaller states like Oregon, they can be about 20%-30% cheaper.
The location and size and type of your subscription box 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.
What Are You Looking For?
Choose and Get Your Free Quote:👇️
General Liability Insurance ->
Professional Liability ->
Product Liability Insurance ->
Commercial Auto ->
Workers Compensation ->
Commercial Property ->
Other Business Insurance ->
Also you can let the internet do the work for you by enquiring about insurance companies near where your business is located.
Another useful source of information is the local Better Business Bureau in your city.
What is small business insurance for subscription box operations?
This is a wide term used to describe basic insurance policies designed to protect subscription box business owners from risks like bodily injury, property damage, claims of negligence.
Does my subscription box 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.
Some other forms are required by state law, such as workers compensation and vehicle insurance.
What does a small subscription box business insurance policy cover?
Liability insurance provides insurance against lawsuits or claims filed by a client for bodily injury, property damage, or negligence.
The specific 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 subscription box insurance.
How much will subscription box business insurance cost?
In addition to the size of the business, several 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 subscription box , in the search box below, and follow the relevant links.