Sewing Business Insurance
Getting insurance for your sewing business is crucial.
This is because sewing businesses need to protect themselves against a variety of different risks, such as property damage disputes, contract violations with commercial landlords, and accidental injuries.
For example, if an employee gets injured while sewing for your store (e.g., as a result of a needle breaking, etc.), you will likely be responsible for compensating them.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Sewing Business
General liability insurance is — generally speaking — one of the most important insurance policies for sewing businesses.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
Having said that, your sewing business will likely benefit from purchasing additional coverage. This is because you will want to protect your assets from additional risks, such as:
- Employment law disputes: These are covered via a workers’ compensation insurance policy.
- Damaged sewing equipment: Covered via a commercial property insurance policy.
- Lost income due to having to temporarily close: Covered via a business interruption insurance policy.
You will also need to find the right business insurer for your sewing business.
There are several great options available, but we recommend going for an online insurer due to the fact that it’s the most affordable option.
This is because online businesses have lower operating costs (i.e., no insurance agent, etc.).
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Cost of General Liability Insurance
The average sewing business in America spends between $400-$1,500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a sewing business to other professional industries using the graph below.
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Discover the best coverage at the lowest rate in our low-cost business insurance review.
Common Situations That General Liability Insurance May Cover for a Sewing Business
Example 1: A client is bringing over some clothing for alterations when she slips and falls in your entryway. She sustains a broken arm and requires medical care. Your general liability insurance policy will likely cover the cost of her treatment.
Example 2: One of your employees leaves a window open overnight while your business is closed. It rains heavily, and the rain comes through the open window and soaks a stack of designer clothing owned by several of your customers. The clothing is ruined. Your general liability insurance policy will pay for the replacement of damaged customer property.
Example 3: While visiting your place of business for measurements, a client slips and falls off of a stool. She breaks her hip and sues your business. The general liability insurance policy you have will pay for your legal defense, including the cost of settling out of court if necessary.
Other Types of Coverage Sewing Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Commercial Property Insurance
The sewing equipment and supplies you have in your business are necessary for you to serve your customers and keep income coming in. But if that property is destroyed, in an event such as in a fire, it may be difficult to replace due to its high cost. A commercial property insurance policy would help pay for the replacement of your commercial property.
Product Liability Insurance
The products you sew and then sell to your customers pose a liability that product liability insurance can help protect you from. If the customer determines that your product caused him or her an injury and files a lawsuit, product liability insurance will pay for your legal defense and any settlements that may be required.
Workers’ Compensation Insurance
If you have employees helping you with your sewing business, it is important to have workers’ compensation insurance. It will pay for treating employee injuries due to work-related activities and will help pay for lost wages while they recover from those injuries. Most states require employers to carry workers’ comp.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your sewing business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Sewing Business Insurance FAQ
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Yes you do. This is because you will want to purchase your business insurance (e.g., workers’ compensation, general liability, etc.) before any liability arises, and this could technically happen as soon as you begin interacting with clients.
Not necessarily. Certain exceptions may be written directly into your sewing business insurance policy, and some perils may be entirely uninsurable.
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.