When does my online store need business insurance?

The increasing power and reach of the internet has allowed online stores to flourish in recent years. All manner of products are sold over the web, from handmade trinkets to food and drink, books and clothing.
But while they often start out as little more than a hobby, online businesses can grow to become their owner’s main source of income. As with any company, you will need to make provisions to carry the appropriate insurance.

There are a number of eventualities that it is prudent to cover against, so it would be wise to take up some form of business insurance as soon as you begin selling goods.

Setting up an online store often means turning one’s home into a place of work, and your standard Household policy may not provide sufficient cover for a business. For example, a third party may need to pick up goods for delivery. As soon as they enter your property an accident could result in a claim being made.

Similarly, if your product injures a customer or causes damage you are liable. The nature of online selling also requires taking credit card and other payment information from customers. This too has potential pitfalls that should be covered against, such as the loss or theft of personal data.

Home Business Insurance from the RAC offers specialist cover for your buildings and contents, including extended liability. There is also an option to extend your Occupiers' and Personal Liability Insurance to cover business-related visitors in your home.

If you sell food and drink or any form of practical item, Products Liability Insurance will protect you in the event of unforeseen injury or damage caused to the public. The loss or theft of data is covered by Professional Indemnity Insurance, which can be procured as part of a bespoke RAC package. Stock cover, including protection against theft and damage, is also a sensible choice for the online store owner.

As web-based shopping grows in popularity the opportunities for sellers are expanding rapidly. Securing the correct type of insurance is therefore vital, and the RAC’s tailor-made policies can offer important financial safeguards.
For more information, talk to one of our specialist advisors and see how we can help.