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Shop insurance

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Shop insurance

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What is Merchant Cover III Insurance?

Merchant Cover III insurance is a type of shopinsurance policy that shields shopkeepers from financial losses caused to their shops due to various perils such as storm, fire, vandalism, etc. It’s a legal contract between you and the insurance company where the insurer offers coverage and reimburses the losses you incur due to damages suffered by your shop.

Merchant Cover III insurance policy covers the physical shop premises, including the shop building and its contents, such as inventory, equipment, and furniture, among others. Furthermore, Merchant Cover III insurance can provide public liability protection, safeguarding you, the shopkeeper, in case someone gets hurt on your shop’s premises. A must-have insurance policy for all shopkeepers, Merchant Cover III insurance helps you mitigate financial losses in the event of any damage.

Why is insurance for your shop important?

Shop insurance is crucial because it protects your shop if unexpected things happen. Imagine if your shop gets damaged by fire, vandalised, or a customer gets hurt on its premises. Without shop insurance , you might end up paying for all the damages from your pocket, which could be expensive. However, with shop insurance, you're covered in the event of any mishaps.

Who needs to buy shop insurance?

The following people should buy shop Insurance:

Independent shopkeepers: If you are an independent shopkeeper running a shop, you need to purchase a merchant cover insurance plan.

Owner of multiple shops: If you own more than one shop or have a chain of shops in various cities, you need to buy a merchant cover insurance policy.

What are the benefits and features of Merchant Cover III Insurance?

Merchant Cover III insurance has several features and benefits. Some of them are as follows:

  • Property protection

    Merchant Cover III insurance covers losses your physical store or shop building suffers from fire, vandalism, or natural calamities like floods or earthquakes.

  • Content coverage

    Merchant Cover III insurance also safeguards the contents inside your shop, including inventory, equipment, furniture, fixtures, etc. It compensates you for replacing them if they're damaged or stolen.

  • Liability coverage

    If third party excluding staff/ employee gets injured on your shop's premises, Merchant Cover III insurance provides liability protection. It covers legal expenses and compensation costs.

  • Customisable policy

    You can tailor your shop insurance policy to fit your specific needs, adding extra coverage as needed.

  • Cost-effective plans

    Merchant Cover III insurance plans are cost-effective. You can get decent coverage at an affordable premium.

  • Most importantly, Merchant Cover III insurance allows you to focus on your business and not worry about the financial consequences of damages suffered by your shop due to natural or man-made disasters. It offers you peace of mind.

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What’s covered under Merchant Cover III Insurance?

  • Inclusions
  • Exclusions

While merchant cover III insurance coverage may differ across policies, in most cases, the policy covers the following:

  • Fire

    Damages suffered by your shop due to fire due to natural heating, spontaneous combustion, forest or jungle fire, etc., are covered.

  • Natural disasters

    If your shop suffers damages from disasters such as earthquakes, floods, cyclones, etc., your shop insurance will cover them.

  • Terrorism

    Merchant cover III insurance will cover damages suffered by your shop due to terrorism, acts of strikes, riots, etc.

Read the policy documents carefully to know the coverage your chosen plan offers.

Merchant cover III insurance has certain exclusions, just like any insurance. Merchant cover III insurance coverage is not offered in the following cases:

  • Unexplained losses

  • Machinery breakdown not due to fire or natural calamity

  • Losses due to nuclear disasters or wars

  • Intentional attempt to damage the shop and its content

  • Damage to equipment due to natural wear and tear

  • Offices, manufacturing concerns, jewellery shops and other high risk shops

Types of Merchant Cover III Insurance plans in India

The different types of plans for insuring shops available in India are as follows:

  • Covering only your shop’s content

    This type of insurance plan only covers the contents of your shop, such as furniture, equipment, etc.

  • Covering only the shop’s building

    This type of insurance plan covers only the shop’s building and offers coverage in case it suffers damages due to natural or man-made disasters.

  • Covering content and building

    This type of insurance plan offers coverage to your shop’s content and building.

Types of shops covered in a Merchant Cover III Insurance policy

Merchant cover III insurance offers coverage to various shops. The different types of shops covered in a merchant cover III insurance policy are as follows:

  • Bookstore and Stationary

  • Chemist/ Pharmacy

  • Chicken/ Poultry/ Egg store

  • Department Store

  • Cloth/Garment shops and/or Dry
    Cleaners/Washer man

  • Electronic Goods Store

  • Florist or Flower shop

  • Fruits and vegetables

  • Furniture/Beds/Accessories store
    Gift card shops

  • Groceries

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As you can see, it covers various types of shops. Contact the insurer if you don’t find your shop’s category. However, in all likelihood, you will find your shop’s category in the policy document.

Frequently asked questions

What is shop insurance, and why do I need one? A shop insurance policy provides coverage for your shop and its content. It compensates you financially in case your shop or its content suffers damages due to natural or man-made causes.
What premium do I need to pay for shop insurance? The premium you need to pay depends on the policy's sum insured and coverage, among other factors. If your shop is in a high-risk business, you need to pay a higher premium.
How to make a claim for a shop insurance policy? Contact your insurer, complete the claim form, and submit the relevant documents. After due diligence, the insurer will settle the claim.

ICICI Lombard’s shop insurance articles

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