Why do clothes shops need insurance?
An overnight theft
You go to open up your shop one morning to discover there’s been a break-in overnight. Valuable stock is missing, as well as money from the till. Plus, there’s damage to the glass storefront. You contact the police, but they can’t find the culprit – or your missing stock.
Become better prepared for unforeseen events at your clothes shop with contents insurance. This could help to pay for repairs and product replacements should you suffer a break-in.
Customer injuries
A customer is trying on some trousers in your clothes shop when they fall and twist their ankle. They blame the uneven floor for the accident and decide to make a claim.
Public liability cover can help pay compensation over personal injury and property damage claims from your customers and other members of the public, as well as contributing towards legal fees.
Employee accusations
Your fashion shop has a big delivery of new clothing, and you’re working together with your team to sort through it. Unfortunately, a member of staff hurts their back when unloading the stock and blames you for not providing the right training. They decide to take you to court.
Employers’ liability insurance can help to pay compensation should your employee bring a claim over their injury. It’s also usually a legal requirement for any business that employs staff.
What insurance is available for clothes shops?
Public liability insurance
For a clothes shop, public liability insurance could provide financial support if a member of the public is injured as a result of your work. You’ll have people passing through your shop every day, and accidents can happen. For example, a customer could slip on an unmarked wet floor or trip over displays. Or a passer-by could be hit by falling signage outside your shop.
Including public liability insurance in your policy may help to cover compensation costs, legal fees, and costs relating to court attendance. This cover normally includes products liability insurance for claims for injury or damage which arise from the items you sell.
Business contents insurance
Business contents insurance can help to protect your clothes shop and its stock against the unexpected. From overnight thefts of designer bags or premium denim to flash flooding and fires that wreck your stylish shop fittings, unforeseen events like these can cause havoc for your retail business.
Whatever you sell in your clothes shop, business contents insurance could help to cover the cost of replacing stolen stock and repairing weather or fire-damaged fittings.
Employers’ liability insurance
Employers’ liability (EL) insurance could help cover you should a staff injury or illness claim arise. This insurance type is generally compulsory (external link), even if you work alone and occasionally hire volunteers or temporary staff.
EL cover may help to pay compensation should an employee suffer an injury and take legal action. It might also help cover legal fees. The Government can fine you for every day you don’t have EL cover.
As a clothes shop owner, there are other types of insurance you may consider. For example, commercial buildings insurance if you own your shop premises. Some fashion shop owners may also add personal accident cover, or cyber insurance.
If you’re not sure what cover you need, tell us more about your clothes shop business. We’ll find the right insurance for you and help build you a tailored policy.
Get your quoteInsurance for clothes shops: FAQs
How much is insurance for a clothing shop?
Insurance costs for a clothing shop will depend on the different covers you build into your policy. Business insurance can be tailored to include specific types of cover, such as public and employers’ liability. To give you a rough idea, Hiscox business insurance starts at £8.40* a month.
*Figures based on an average of all business insurance policies sold to at least 10% of our customer base between August 2023 and August 2024
Do I need a licence to open a clothes shop in the UK?
You don’t need a specific licence to sell new clothes through your shop. However, you might require a PPL PRS licence if you intend to play music in the background. Meanwhile, second-hand clothing retailers in Scotland will usually require a licence to operate from their local council.
What insurance do you need to sell clothing?
You may decide to take out products liability insurance to sell clothes. This could help to cover compensation costs should anyone claim to have been injured by a faulty product you have designed, manufactured, sold, or supplied.
For a clothes shop, this type of insurance, often sold alongside public liability, can be more relevant if you source your clothes from outside the UK or if you tailor your own clothes.
What is shop-front insurance?
Shop-front insurance covers your shop-front as well as any glass throughout your premises. It’s designed to step in if your display windows are smashed, and it is sometimes sold as a standalone product. With Hiscox, business contents insurance can also cover any glass display and signage outside of your shop.
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