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Why do fabric stores need insurance?
If a customer trips over a bolt of fabric and suffers a concussion, the resulting legal costs could force your business to close. Business insurance helps your fabric shop withstand costly lawsuits. It can also pay for worker injuries, burglaries, data breaches, and damage from fires and storms.
Find affordable coverage
Fabric store owners can save money on insurance by comparing quotes from top-rated providers.
Fill out Insureon's easy online application to get free quotes and advice from a licensed agent.
What types of insurance do fabric stores need?
Fabric shop owners often buy the following insurance products.
Business owner's policy
A business owner's policy, or BOP, is a cost-effective way for fabric stores to buy general liability coverage and commercial property coverage together.
BEST FOR
- Product liability lawsuits
- Damaged or stolen inventory
- Business interruption coverage
General liability insurance
This policy covers common third-party lawsuits, such as slip-and-fall accidents. It typically includes product liability insurance for financial protection against harm caused by your products.
BEST FOR
- Customer injuries
- Product liability claims
- Copyright infringement
Workers’ compensation insurance
Most states require workers' comp for fabric store businesses that have employees. It also protects sole proprietors from work-related medical bills that health insurance might deny.
BEST FOR
- Employee medical expenses
- Lost wages during recovery
- Legal fees from worker injuries
Cyber insurance
This policy helps small business owners recover from data breaches and cyberattacks. It's recommended for fabric stores that handle email addresses and other personal information.
BEST FOR
- Customer notification expenses
- Fraud monitoring services
- Cyber extortion demands
Commercial umbrella insurance
Umbrella insurance boosts coverage on a fabric shop's general liability, employer’s liability, or commercial auto insurance policy once the limit is reached on a claim.
BEST FOR
- Customer injury lawsuits
- Property damage lawsuits
- Auto accident lawsuits
Commercial auto insurance
Most states require commercial auto insurance for business-owned vehicles. This policy covers accidents involving a fabric store's delivery van or other vehicle.
BEST FOR
- Injuries caused to another person
- Property damage caused by your vehicle
- Vehicle theft and vandalism
Looking for different coverage? See more policies.
How much does business insurance cost for retail stores?
A fabric store with only a few employees will pay less for insurance than a larger business.
Factors that affect the cost of insurance include:
- Products sold, such as specialty fabrics, sewing machines, and crafts
- Business equipment and property
- Number of employees
- Types of insurance purchased
- Deductibles and other insurance options
- Claims history
How do I get business insurance for fabric stores?
It's easy to get fabric store insurance if you have your business information on hand. Our application will ask for basic facts about your shop, such as revenue and number of employees. You can buy a policy online and get a certificate of insurance with Insureon in three easy steps:
- Complete a free online application.
- Compare insurance quotes and choose policies.
- Pay for your policy and download a certificate.
Insureon's licensed insurance agents work with top-rated U.S. providers to find the right insurance coverage for your fabric store, whether you're a sole proprietor or hire employees. Get insured today and find peace of mind knowing your business can survive the unexpected.
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FAQs about fabric store insurance
Review answers to common questions about insurance for fabric shops.
Do fabric stores need product liability insurance?
Product liability insurance is a must-have for all retailers, including fabric stores. This policy protects you financially in the event of a lawsuit related to your products. It's typically included in your general liability policy.
Even if a defective product wasn't your fault, a customer could still hold you responsible. Every business in the supply chain can be held liable for harm caused by their products, which is why they all need this coverage.
This policy helps pay for legal costs if you're sued over:
- Design defects
- Manufacturer defects
- Marketing defects
Even when you're insured, it's crucial to reduce your risks as much as possible to avoid a lawsuit. For example, sewing machines should have clear instructions and warnings about potential injuries. Claims are expensive—and also cause your insurance rates to increase.
Along with product liability insurance, consider carrying product recall insurance. It will help pay for disposal, restocking, and shipping costs associated with a product recall.
Does fabric store insurance protect against theft?
Commercial crime insurance covers shoplifting, burglaries, and similar incidents at your fabric store. There are a couple different types of crime insurance:
- Commercial property insurance: This policy helps you recover financially when someone steals inventory, supplies, or equipment from your business premises. It's also called business hazard insurance.
- Fidelity bond: A fidelity bond provides financial compensation when one of your employees steals from your business or a client. It's sometimes called employee dishonesty coverage.
In addition to carrying insurance, it's important to install a security system and take other precautions to prevent theft. Some insurance companies offer a discount on your premium when you follow their recommended steps for improving security.
What other types of insurance policies should fabric stores carry?
To fully protect your fabric shop, you may need additional types of insurance. Consider the following policies for coverage against other risks you might face:
- Business interruption insurance: Also called business income insurance, this policy covers financial losses when your business is forced to close temporarily due to a fire or other covered property claim. It can pay for lost income, relocation costs, and employee wages.
- Equipment breakdown coverage: This policy protects your computers, electrical systems, fabric cutting machines, and other equipment from sudden malfunctions. It covers financial losses from short circuits, loss of air pressure or vacuum, or power surges that commercial property insurance typically excludes.
- Electronic data processing (EDP) insurance: This covers electronic data processing equipment, such as computers and POS systems, against data loss during a power surge, fire, natural disaster, or similar incident.
You can often add coverage to a BOP for a discount. Learn about other ways you can save money on small business insurance.