Thrift Store Business Insurance

Owners of thrift shops can use Insuranceopedia to review business insurance policies from leading carriers. This platform makes it easier to secure the best protection for property damage, employee safety, and general liability risks.

Why Do Thrift Store Businesses Need Insurance?

Operating a thrift store involves specific risks, including theft, customer injuries, property damage, and legal liabilities. Secondhand shop owners must protect their financial stability against losses caused by fires, natural disasters, business interruptions, or lawsuits.

For instance, suppose a shopper tries on a pair of used high heels at your shop. If a heel snaps and causes an ankle injury, that customer might sue you for their medical bills and legal fees. Without product liability coverage, the costs associated with selling defective items could threaten your ability to stay open.

You also face risks related to having staff on-site and common accidents like slips and falls. Essential policies like general liability and commercial property insurance help manage these dangers, allowing you to run your business with peace of mind.

Then you add the liabilities of having employees working in your store, the risk of things like tripping and falling, as well as property damage from natural disasters, and it’s important to see how things like general liability insurance and commercial property insurance can give you peace of mind.

What Insurance Do Thrift Stores Need?

Thrift stores face unique daily risks ranging from customer accidents in the aisles to potential issues with donated inventory. To keep your shop running smoothly and protect your bottom line, you need the right coverage. Here is a look at the most critical types of business insurance policies for your business.

General Liability Insurance

This is the most basic coverage that almost every small business needs. It protects your shop if a third party claims you caused them bodily injury, property damage, or reputational harm. If a customer gets hurt on your premises, this policy helps pay for legal defense, settlements, and medical costs.

Example: A customer visits your thrift store on a rainy day and slips on a wet spot near the entrance. They break their wrist and sue for medical bills. General liability insurance can help cover those costs.

Business Personal Property (BPP) Insurance

BPP is designed to protect the movable items inside your store. This includes your inventory of vintage clothes and furniture, as well as your cash register, racks, and shelving. It pays to repair or replace these items if they are lost or damaged by covered events like fire or theft.

Example: A pipe bursts overnight and floods your back room, ruining boxes of donated books and clothing. BPP helps pay to replace the damaged stock so you can restock your shelves.

Workers’ Compensation Insurance

If you have staff helping you sort donations or run the register, you likely need this coverage. It protects your employees if they get sick or hurt while doing their job. It pays for their medical bills, rehabilitation costs, and lost wages while they recover. Most states require this by law as soon as you hire your first employee.

Example: An employee hurts their back while lifting a heavy piece of donated furniture. Workers’ compensation covers their doctor visits and pays a portion of their wages while they heal.

Commercial Property Insurance

While BPP covers what is inside the store, this policy covers the building itself. Whether you own the building or lease the space, this insurance protects the structure against physical damage from fire, vandalism, wind, and other common hazards.

Example: A storm breaks a large display window at the front of your shop. Commercial property insurance helps cover the cost of repairs to the building.

Product Liability Insurance

Thrift stores sell used goods, which carry a specific set of risks. This insurance protects your business if a product you sell causes injury or damage to a customer. This applies even if the defect was unknown to you at the time of sale. It covers legal fees and damages if a customer sues.

Example: You sell a used lamp that has faulty wiring. It sparks a small fire in a customer’s home. They sue your store for the damages. Product liability helps cover the legal claim. The average cost for professional liability coverage to protect against errors is often around $42 per month.

Business Owner’s Policy (BOP)

A BOP is a convenient package that combines general liability and commercial property insurance into one bundle. It is usually cheaper than buying the policies separately. This provides broad protection for both your liability risks and your physical assets.

Example: A fire starts in the breakroom, damaging the walls and destroying inventory. A BOP helps you pay for the building repairs and the loss of your business property.

Cyber Liability Insurance

If your store accepts credit cards or keeps a digital list of donors and customers, you are at risk of cybercrime. This policy covers the costs associated with data breaches, including legal fees, notifying customers, and credit monitoring services.

Example: A hacker breaches your point-of-sale system and steals customer credit card numbers. Cyber liability insurance helps pay for the investigation and the required notifications to affected customers.

Commercial Auto Insurance

Personal car insurance policies usually exclude accidents that happen while driving for work. If your business owns a van or truck for picking up large donations or delivering furniture, you need commercial auto insurance. It covers injuries and property damage if you or an employee gets into an accident in a company vehicle.

Example: Your driver runs a red light while delivering a sofa and hits another car. Commercial auto insurance covers damage to the other vehicle and medical costs for the other driver.

Business Interruption Insurance

This coverage protects your income if you are forced to close your shop temporarily due to a covered disaster. It helps pay for ongoing expenses like rent and payroll, as well as the profit you would have earned during the closure.

Example: A fire next door causes smoke damage that forces your thrift store to close for two weeks for cleaning. Business interruption insurance helps replace the income you lost during those two weeks.

Hired And Non-Owned Auto (HNOA) Insurance

This policy is vital if your employees ever use their personal cars for work tasks. It provides liability coverage for your business if they cause an accident while running a work errand. Note that it does not cover damage to the employee’s car, but it protects the business from being sued.

Example: You send an employee to the bank to deposit cash in their own car. On the way, they rear-end someone. HNOA protects your business if the other driver sues.

Employment Practices Liability Insurance

This protects your business against claims made by employees alleging their legal rights were violated. This includes accusations of discrimination, sexual harassment, or wrongful termination. It covers defense costs and settlements.

Example: A former employee sues your shop claiming they were fired because of their age. Employment practices liability insurance helps cover your legal defense fees and any resulting judgments.

Umbrella Insurance

Umbrella insurance provides an extra layer of liability protection. It kicks in when a claim exceeds the limits of your primary policies, such as general liability or commercial auto. It is a safety net for major lawsuits.

Example: A customer is severely injured in your store and wins a lawsuit for $1 million. Your general liability policy only covers up to $500,000. Umbrella insurance pays the remaining $500,000.

These policies work together to create a safety net for your thrift store. You may not need every single policy listed here, but understanding your options helps you build the right plan. Proper coverage ensures your shop can keep serving the community, whether you run a small boutique or a large donation center.

Cheapest Thrift Store Workers’ Compensation Insurance

NEXT Insurance offers the most affordable Workers’ Compensation coverage for thrift stores, with annual premiums often starting at $176 for low-risk operations.

Note: Estimates are based on 2024-2025 carrier data for small retail businesses with 1-3 employees and low payroll (under $100,000). Thrift stores often fall under specific “Retail” or “Nonprofit” class codes (e.g., 8017), which carry moderate risk due to physical lifting of donations. Actual premiums depend heavily on your specific state’s payroll laws and your store’s claims history.

Cheapest Thrift Store General Liability Insurance

biBerk provides one of the lowest entry points for General Liability insurance for thrift stores, with policies starting around $336 per year.

Note: These figures reflect “base” liability limits (typically $1 million per occurrence / $2 million aggregate) for a small leased storefront with moderate foot traffic. Rates for thrift stores can be impacted by “premises liability” factors, such as cluttered aisles or high customer volume, which may cause your specific quote to be higher than these starting baselines.

Cheapest Thrift Store Business Owner’s Policy

NEXT Insurance is the cost leader for bundled coverage, offering a Business Owners Policy that combines liability and property protection at a highly competitive rate of around $305 annually.

Note: A BOP bundles General Liability with Commercial Property insurance. These estimates assume a small thrift shop renting its space with low inventory value (under $50,000 in donated goods). Because thrift inventory is secondhand, carriers may value it differently than new retail stock; higher property limits or adding “business interruption” coverage will increase these costs.

How Much Does Thrift Store Insurance Cost?

On average, general liability insurance costs thrift stores about $53 per month. This price varies based on several details about your specific shop. Insurance providers look at your location, the size of your staff, and the type of inventory you sell. Your history of insurance claims and how well you keep records also impact your business insurance cost. If you transport expensive equipment, that plays a role as well.

You might adjust your costs by changing your coverage limits or bundling multiple policies. While saving money is great, do not simply pick the cheapest plan you find. You need to make sure the policy actually covers the risks your business faces every day.

Note: These estimates are based on analysis of recent industry data for retail and reseller businesses in the United States, considering the unique risk profile of thrift stores. The Business Owners Policy (BOP) typically bundles General Liability and Commercial Property at a discounted rate, which is reflected in the pricing relative to purchasing them separately. Actual premiums will vary significantly based on your store’s location, annual revenue, number of employees, claims history, and specific coverage limits.

How Is Your Thrift Store Business Insurance Cost Calculated?

Insurance providers analyze several specific details to calculate your premium. Their goal is to determine how much risk your business presents. If you operate a large thrift store, you likely have more customers walking through the aisles. This higher foot traffic increases the chance of accidents or theft, which can raise your insurance costs.

The size of your team is another major factor. Having more employees to sort donations or work the registers typically leads to a higher premium.

Your location also plays a significant role in the price. Rates are often higher if your shop is in an area known for high crime rates or severe weather. Local laws and building codes may also dictate specific coverage requirements that affect your bottom line.

Underwriters will also check your track record. If you have filed claims in the past, insurers may view you as a higher risk. They also consider the value of your business property, such as your inventory, racks, and any donation pickup vans you own. Finally, your chosen coverage limits and your business structure will impact the final price.

Following these steps helps ensure you’re properly insured and set up to handle risks confidently and professionally.