Gift Basket Business Insurance
Getting insurance for your gift basket business is essential.
Gift basket businesses need to be protected against claims of things like product liability, breach of contract, and intellectual property infringement.
For example, a customer feels a gift basket sold by your business does not deliver on its promised contents, or a brand claims that they did not give you permission to use their products.
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 Gift Basket Business
General liability insurance is — generally speaking — one of the most important insurance policies for gift basket businesses.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
By and large, gift basket businesses tend to take advantage of a number of insurance policies alongside general liability, such as:
- Commercial auto insurance
- Workers’ compensation insurance
- Commercial property insurance
- Commercial umbrella insurance
The places your business is able to buy these policies from are typically categorized into two groups:
- Traditional brick-and-mortar insurers — Providers with physical premises (e.g., storefronts and offices). Most of the largest firms in the US (e.g., Nationwide and Hiscox) are included in this group.
- Online insurers — Providers without physical premises (i.e., those that operate entirely online). These firms are typically quite young (e.g., Tivly and Next) but are better able to provide great deals on reliable policies thanks to their less expensive business structure.
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Cost of General Liability Insurance
On average, gift basket businesses in America spend between $400 - $1500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a gift basket 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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Common Situations That General Liability Insurance May Cover for a Gift Basket Business
Example 1: Near the end of a slow day, your employees start their closing duties early. While an employee vacuums, a customer walks in, trips on the vacuum cord and shatters their elbow in the fall. General liability insurance would cover the customer’s medical bills and any settlement payout if they pursue a lawsuit.
Example 2: After you run a newspaper ad campaign with your redesigned logo, a competitor claims your logo closely resembles their logo and threatens a lawsuit. Your general liability coverage would cover your legal costs and any settlement awarded in the lawsuit.
Example 3: As you walk to the storeroom to collect a customer’s order, the waiting customer follows you behind the counter and takes a hard fall after slipping on the wet floor. General liability insurance would cover the customer’s medical costs and your legal fees in the event of a lawsuit.
Other Types of Coverage Gift Basket 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 Auto Insurance
If you use a personal car to deliver your gift baskets, your personal auto coverage won’t cover damages resulting from a work-related accident. Commercial auto insurance protects your business and personal vehicles if an accident happens while you or your employees uses them to perform work duties.
Workers’ Compensation Insurance
Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover, but also any disability benefits stemming from a work-related accident.
Commercial Property Insurance
If you own the building in which you operate, you’re responsible for all business-related equipment and inventory housed there in the event of a fire or other accident. Commercial property insurance would cover the cost of repairing or replacing your equipment and property after an accident so you can resume normal operations quickly.
Commercial Umbrella Insurance
Even the most responsible business owners sometimes face an accident or lawsuit so catastrophic that it threatens to exhaust the limits of their primary insurance coverage. Commercial umbrella insurance protects you from paying out-of-pocket for any legal fees and awarded damages that exceed your primary policy.
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 gift basket 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.
Gift Basket 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.
Even in cases where your gift basket business is not obliged by law to hold some form of business insurance to operate legitimately (e.g., commercial auto or workers’ compensation), its importance cannot be understated.
This is what provides your business with the financial stability it needs in order to succeed in the long term.
Not necessarily. Certain exceptions may be written directly into your gift basket 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.