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Business insurance is designed to protect a business owner’s financial assets and is an essential investment for a gas station.
All businesses, regardless of industry, face risks that should be covered by insurance. The most common and comprehensive type of policy business owners invest in is general liability insurance (or CGL).
Some of the risks CGL insurance covers are:
While businesses aren’t legally required to carry general liability insurance, operating without it is extremely risky. If your business is sued, you could end up facing fees totaling hundreds of thousands of dollars (or more). Having a sufficient CGL policy in place to help compensate for these damages is the only way to prevent this type of event from devastating your business.
The average gas station in America spends between $450-$1,000 per year for $1 million in general liability coverage.
Several factors will determine the price of your policy. These include your:
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.
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 other types of insurance all gas stations should obtain:
Gas stations normally need commercial property insurance for their building and pumps. Property insurance often also covers items that a business owns and keeps on its property.
Gas stations frequently have expensive build-outs because pumps must be carefully designed and installed. Make sure you have enough coverage to replace both your station’s building and its pumps.
This coverage is often available as part of a business owner’s policy (BOP).
Most gas stations need workers’ compensation insurance because they have employees. Workers compensation covers work-related injuries and illnesses, and many states legally require businesses that employ workers to carry it.
Workers’ compensation insurance is usually purchased on its own.
Running a gas station comes with many regular expenses, and bills don’t cease after a disaster. Should your gas station have to shut down following a disaster, business interruption insurance may help pay expenses while the station is closed and not bringing in revenue.
Business interruption insurance is widely available as part of a BOP.
Customers expect to be able to pay at the pump, but accepting card payments exposes a business to potential data breaches. Data breach insurance may provide coverage if customers’ payment information is stolen through skimmers or via another means.
Data breach insurance can be added to a business owner’s policy as an endorsement, as opposed to a stand-alone policy.
In addition to the policies outlined above, there are a few other types of coverage your gas stations may require depending on certain aspects of your operations. Some of these might not apply to you, so be sure to ask your agent which policies are right for your business.
A gasoline-fueled fire can quickly cause substantial damage and injury, and resulting lawsuits tend to be expensive. Commercial umbrella insurance offers additional liability protection that might help cover expensive lawsuits like these (and others).
Commercial umbrella insurance can be added to some BOPs.
Though liquor laws and the insurance policies surrounding the sale of liquor vary from state-to-state and situation-to-situation, liquor liability insurance may be needed to protect your assets if your gas station serves or sells alcohol.