If you’re opening up a mattress store, you’re probably wondering whether you need to buy insurance and what you’ll need to protect.
How do you know which coverage you need? What amount of coverage should you choose – and how much will it cost? Read on to find out.
Related – Guide to starting a furniture store
What are Some of the Risks of a Mattress Store?
When it comes to opening a mattress store, it may come as a surprise to learn that there are risks involved – especially if you choose to sell:
- Water beds
- Heated mattresses
- Children’s beds and cribs
- Second-hand mattresses
While there are so many other options you can choose to offer your clients, there are general risks involved that you’ll need to be covered for.
1. Damages to Your Products
Since you’ll be selling mattresses and other related products at your store, it goes without saying that you’ll want to protect your inventory – whether it’s in the store or on its way to your customers.
Plus, if you have any delivery trucks or heavy machinery (such as forklifts and power tools), they can easily get damaged or stolen as well – so it’s important to make sure they’re all covered.
Do you have a plan in place in the event you or your staff get injured on the job – or if customers get injured in your store? What if a mattress was improperly installed in a customer’s home?
No matter what the reason for the injury, you definitely don’t want to be left with hefty medical bills.
3. Bed Bug Infestation
This can be a huge liability to mattress store owners – especially if you intend on selling second-hand mattresses. If a mattress store doesn’t have sufficient processes in place to ensure that none of the products sold are infested, they can be held accountable – and be forced to pay compensation to the customers.
4. Property Damage
Mattress stores that deliver their products should be covered in the event of damage to your client’s homes – which can include accidentally breaking personal items of the homeowners or hitting another vehicle with the delivery truck.
Types of Insurance Coverage a Mattress Store Should Consider
Getting the proper insurance coverage is really important when opening a mattress store. It’s crucial to set up policies that can protect you as the business owner, your employees, the customers you’re selling to, your equipment, and your products.
Generally, purchasing a Business Owners Policy (BOP) will provide you with all the coverage you need – however, it’s important to know what to include and what you may not need. Here are the must-have insurance coverages for your business:
1. Business Auto Insurance
Whether you have a work van, a large delivery truck, or a fleet of delivery vehicles, a business auto policy can cover all of them – and will make sure you’re covered for:
- Damage to your vehicles or someone else’s vehicle as a result of an accident
- Property damage (i.e., in the event your vehicle causes damage to a fence, pole, or other fixed objects)
- Liability (in the event you are sued due to a motor vehicle accident)
- Injuries and medical bills (to the drivers of your vehicles and a third party)
How Much Does Business Auto Insurance Cost?
The annual cost for business auto insurance for a mattress store can vary depending on:
- How many drivers are operating the vehicles and their driving records
- How many vehicles you have on your policy
- The type of vehicle (i.e., a truck vs. a standard van)
- How much coverage you choose to have
On average, this will cost you about $1,920 – $2,800/year ($160 – $234 per month).
2. General Liability Insurance
Simply put, general liability insurance covers you in the event your business gets sued for nearly any business-related issue.
This will make sure you’re covered for injuries and damages caused by you and your employees at your physical business location where you meet clients, sell products, and offer consultations. You’ll also be covered for any liability that occurs when your products are being delivered.
In particular, you’ll need General Liability coverage to protect you from lawsuits that might arise from:
- Accidental injuries to customers
- Damage to the home you’re delivering to
- Negligence from you or your employee’s part
- False advertising
- Products liability coverage (if the products you’re selling/sold cause injury to others)
Typically, the best coverage option is to select a “Per Occurrence” option for your liability. This means that you’ll be protected for every incident that occurred during your policy term – as long as you had an active policy at the time.
Coverage amounts will typically be offered in increments of $1,000,000. You might see this coverage listed as:
What this means is that you’ll have $1,000,000 in coverage for each occurrence (i.e., each time you get sued), with a maximum of $2,000,000 in coverage for the entire policy period (typically 1 year).
How Much Does General Liability Insurance Cost?
This tends to vary depending on:
- How many homes your company typically delivers to per week
- How many locations you have
- Your business hours
- How many employees you have
- Whether or not you have been sued in the past
On average, a $1,000,000/$2,000,000 general liability policy will cost approximately $1,500 – $2,000 per year ($125 – $166 per month).
3. Business Property Insurance
As a mattress store owner, you’ll need to be protected in the event something were to happen to anything in your store. This can include office furniture, cash on-premises, damage to property rented by you, your products, computer equipment, and more. Typically, this will cover you in the event of:
- Pipe burst
- Loss of use/Business Interruption (i.e., you can’t stay in your office space due to one of the reasons above)
It’s important to keep in mind that business property insurance only covers your items if they’re damaged in your specified location – and not anywhere else.
How Much Does Business Property Insurance Cost?
The average cost of business property insurance coverage for a mattress store is approximately $500.00-$1,000.00 per year and can vary based on:
- The type and size of the location (i.e., storefront, storage facility, large office space)
- How much coverage you need for your property
- The approximate total value of equipment and supplies kept on-premises
4. Inland Marine Insurance (Transportation Coverage)
Don’t let the name fool you! This is essential coverage for your mattress store if you deliver mattresses to customers, as it protects you in the event your supplies and products are lost, stolen, or damaged while in transport.
It’s important to note, however, that this won’t cover you for products that are damaged due to negligence, improper packing, or delay.
How Much Does Inland Marine Insurance Cost?
Inland Marine policies for mattress stores will typically cost anywhere from $100.00-$300.00 per year.
5. Workers’ Compensation/Disability Insurance
If you have employees, purchasing a worker’s compensation policy is extremely important. In fact, most states require that you maintain a current and active policy.
A worker’s compensation policy will cover you and your employees in the event of:
- Injuries sustained while working, regardless of how they occurred
- Loss of wages
- Disability caused by work accidents
How Much Does Worker’s Compensation Insurance Cost?
Costs vary based on the risk of injury involved, the number of active employees, and the total salary that each employee is paid per year. On average, worker’s compensation policies for a mattress store can cost $300 – $1,200 per year.
The Bottom Line
Purchasing a Business Owners Policy can make sure your mattress store is properly covered for everything listed above – and having one policy (under the same insurance company) can save you money.
Here are the average annual costs for a mattress store’s insurance coverage:
- Business Auto: $1,920 – $2,800/year
- General Liability: $1,500 – $2,000/year
- Business Property Insurance: $500 – $1,000/year
- Inland Marine: $100 – $300/year
- Workers Compensation: $300 – $1,200/year
In total, insurance for your mattress store will cost approximately $4,320 – $7,300/year.
Have additional questions about starting your mattress store? You’ll find all the answers here.