With the development of retail market retailers feel a growing need to protect their business from random adversities and incidental expenses. Of all risk management methods, insurance has been and continues to be the most popular one.
Practically all trade companies and chains with significant sales volumes are interested to protect their property from the numerous risks there are. Even a minor breakdown or failure of equipment may turn against the owner or leaseholder of trading floors in the form of expenses repairs and restitution of damages that may be caused to their ‘neighbors’. It is only one scenario of events which may introduce its ‘undesirable corrections’ in the normal course of business.
Property and liability insurance with Ingosstrakh arms retailers (large, medium and small) with the best tool to protect their investments and reputation and hedge themselves from financial losses through direct damages to own or loaned property or damages caused to third parties.
Property insurance
Insurable objects
The building (and construction elements of the building) where the retailer is located, as well as auxiliary buildings and constructions that are not directly engaged in the retail business.
Cost of repair and interior furnishing, including:
Facing, including buildups and external equipment.
Interior finishing, intellectual control systems, computer networks, alarm systems, fire detection and suppression systems.
Engineering and utility communications (heating and air conditioning).
Explosion of steam boilers, gas reservoirs, cars, machinery and similar mechanisms.
Property damage by water from water supply, sewerage, heating and automatic fire-suppression systems.
Theft with unauthorized access, robbery.
Intended malicious action of a third party.
Collision with a road vehicle.
Fall of a piloted aircraft.
Breaking of window glass, mirrors, shop windows.
Property damage in an act of terrorism.
Insurance against ‘all risks’. An alternative to insurance against fire and other perils is insurance on ‘all risks’ terms. With this type of insurance, your property will be insured against loss, destruction or damage through sudden and unpredictable impact or a probable event (for any reason).
Top-up cover
Some property can be insured against specific risks inherent to such property type:
Electronic equipment which can be insured against failure due to:
Operational or service errors;
Negligence on the part of servicing/maintenance personnel or malicious intent of a third party;
Exposure to electric current, amperage or voltage jumps in the grid, exposure to induction currents;
Defection of materials, errors in the design, manufacturing process or in assembling/installation of insured objects;
Emergency power outage (public power grid);
Failure of air-conditioning.
This type of insurance is extremely relevant for extensive computer networks, complex computation (processing) centers and other objects where similar expensive equipment is in operation.
Complex machinery and mechanisms and similar equipment can be insured against destruction (damage) through:
Emergency breakdowns or defections;
Errors or negligence of personnel or third parties;
Tow or chain rupture, fall of insured objects and their impact against other objects;
Overload, overheat, vibration, fault, wedging, clogging of mechanisms, change of internal pressure, wear & tear of mechanisms, exposure to centrifugal force;
Hydraulic impact and lack of liquid in boilers or equipment operating on steam or liquids;
Exposure to electric short circuit, network overload, voltage loss, atmospheric disturbances etc, including damages through resulting fire if the damages are caused by the object where the fire started;
Explosion of steam boilers, internal combustion engines and other sources of energy provided that indemnifiable are the damages caused directly to the named objects by their explosion;
Failure or breakdown of add-on equipment, protection or control devices.
This type of coverage includes elevators, escalators, exhaust and air conditioning systems, heating equipment etc.
Cold storage insurance.
Insured amount
The basis for calculation of the insured amount for property of retailers is the present value of such property. It is calculated on the basis of costs estimates and other documentation pertaining to construction, finishing, set-up and commissioning works of the retailer or on the basis of the appraiser’s opinion. An alternative is to calculate the insured amount on the basis of the book value of such property.
Business interruption insurance
This type of insurance protects retailers from indirect losses incurred as the result of business interruption due to an insured event in property insurance during a certain period (indemnification period) which may be 3, 6, 9, 12 and 24 months.
Insurable objects
Payroll;
Social charges;
Taxes and duties which are not linked to the company’s turnover;
Amortization;
Rent;
Utility services;
Interest payable on bank loans;
Other expenses related to continuing the insured type of business;
Shortfall in collection of average profit per interruption period.
Insurable risks
Material damages (damage or destruction of insured property) through actualization of any of the insured risks listed in the contract (natural disaster, fire, explosion etc) which causes interruption (or partial termination) of the company’s business, where the business can be resumed only after elimination of such material damages.
Insurance against lost rent
This type of insurance protects lessors from indirect losses incurred as the result of loss of rental payments due to further impossibility to lease out shopping floors due to an insured event under property insurance during a certain period (indemnification period) which may be 3, 6, 9, 12 and 24 months.
Liability insurance
After insuring property against all potential risks a shopping center leaseholder may nevertheless find itself in a situation where it would be liable to restitute the damages caused to the life or property of third parties, environmental damages etc. For example, a fire in a shopping center may damage nearby buildings or passers-by or a local park, and the guilty party will be liable to pay compensations to each third party to incur damages caused by such fire. Therefore, the damages incurred by a third party may become yours of you are found liable. The best protection for such instances is liability insurance:
Third party liability insurance. Third parties include: other leaseholders, visitors, passers-by, other persons. The indemnity under such type of insurance is aimed to cover the damages caused in an insured event to property, health and life of third parties. An insured event is an event connected with the use of property, such use resulting in damages of third parties, i.e. as the result of a fire outbreak, failure or breakdown of equipment etc.
Employer’s liability. This type of insurance enables companies to restitute the damages caused to your employees during their employment, including medical expenses, healthcare costs, dismissal and income lost through disablement (temporary or permanent, partial or full).
Liability insurance in operation of dangerous facilities. Currently, this liability type is subject to compulsory insurance. The indemnification will help you restitute the damages to third parties caused by the accident at a facility referred to this type, and cover the cost of liquidating environmental damages enforced on the insurant.
Insurance for the period of repair, equipping and interior finishing of leased shop floors. To protect the interest of owners or premises and to meet the terms and conditions of lease agreements, the leaseholder may choose to enter a civil liability insurance contract against losses/damages caused to third parties (including lessor, other leaseholders and visitors) at any time during the period of repairs, finishing etc of the leased shop floors. The limit of liability shall be sufficient to cover the damages dependent on the scope and character of repairs, finishing etc.
Our Contacts
If you have any question or need any additional information, please do not hesitate to contact our Property and Liability Insurance Department:
