Shop Insurance

A shop insurance policy is a customised insurance plan designed for shop owners. Under this plan, shop owners will receive financial protection for their shop property and contents against various mishaps.

It offers protection against various risks that cause damage to your shop, such as fire, theft, burglary, damage caused to another person or property by you, etc. With this policy, you can also secure your shop against accidental damage, your electronic equipment, and rent with our wide range of add-ons.

TATA AIG offers 2 types of Shop Insurance plans:

• TATA AIG Bharat Sookshma Udyam Suraksha

This plan is specifically for shops that have assets worth less than ₹5 crores. This means that this plan offers a maximum sum insured of up to ₹5 crores and offers coverage for the property, partial or total loss of stock and machinery.

• TATA AIG Business Guard Laghu Package Policy

This plan is designed for larger shops or enterprises, with assets valued between ₹5 crores and ₹50 crores. It offers high coverage with a maximum sum insured of up to ₹50 crores. It also offers higher coverage for specific contents, including money, computers and employees’ personal effects.

With TATA AIG, you will get the following shop insurance coverage:

• Fire: Protects your shop and its contents from damage caused by fermentation, natural heating or sudden fire.

• Bush Fire: Protects your shop and its contents from damage caused by accidental fires, ensuring financial security.

• Natural Calamities: Protects against losses caused by severe natural disasters like cyclones, floods, hurricanes and storms.

• Lightning: Provides coverage for damages caused directly by lightning strikes to the shop or its contents.

• Impact Damage: Covers damage caused by animals, falling trees, walls or any other external objects crashing into your shop.

• Implosions and Explosions: Covers damage caused by explosions or implosions of equipment like boilers or pressure vessels.

• Leakage from Automatic Sprinkler Installations: Covers damages caused by accidental leakage from sprinkler systems installed in the shop.

• Malicious Damage and Riot Strike: Covers damage caused by vandalism, riots, or strikes affecting your shop and its contents.

• Damage due to Railroad Vehicles: Covers damage caused by accidents involving railroad vehicles, like a train derailing into your shop premises.

• Aircraft Damage: Covers damage caused to your shop by an aircraft crashing into the premises or objects falling from an aircraft.

• Missile Testing Operations: Provides coverage for damages resulting from missile testing or related defence activities near your shop.

Add-ons Offered Under Shop Insurance Online

Some of the standard exclusions that are not covered under shop insurance plans are:

• Loss or damage caused due to:

• War-like operations or war

• Pollution or contamination

• Contamination due to radioactive waste, ionising rations, nuclear fuels, etc.

• Losses of earnings

• Burglary loss or damage or destruction due to:

• Member of insured household or shop staff

• Explosions or fire

• Portable equipment loss or damage or destruction due to:

• Confiscation by costumes or other authorities

• Restoring, cleaning, repairing, general wear and tear, etc.

• Legal liability or consequential losses

• Electronic equipment loss or damage or destruction due to:

• Faults or defects

• Wear and tear

• Machinery breakdown loss or damage or destruction due to:

• Negligence or willful act

• Deterioration by everyday use

• Money loss due to:

• Use of duplicate keys or original keys

• Use of counterfeit money

• Act of any employer or agent of an insurer

• Neon sign boards loss or damage or destruction due to:

• Cracks or scratches

• Alliteration or replacement

• Personal liability or damage due to:

• Injury under the influence of intoxicating substances

• Suicide

• Public liability due to:

• Non-compliance with statutory provisions

• Exemplary damages

• Fines and penalties damages

• Workmen's compensation arising out of:

• Intentional non-compliance with statutory rules

• High Risks for Commercial Spaces: There has been a rise in burglary and theft cases in India, with burglaries up by 25.2% in 2024 when compared with cases in 2023 and about 60% more than 2022. Such crimes have resulted in increase in “shrinkage” or loss of stock in 2024. Thus, protecting your shop is more important than ever.

• Financial Coverage: Shops, such as grocery shops or electronics shops, run on day-to-day profits. Shop insurance helps you reduce the financial loss caused by unexpected events such as fire, theft, natural disasters, etc.

• Start-Up Expenses and Professional Fees Cover: Resetting your new shop can be challenging and a huge financial burden. With shop insurance, you get coverage to recover from damages caused by various perils and ensure smooth operations.

• All-In-One Policy: Our shop insurance policy offers coverage from all major risks under the same plan. This includes fire, burglary, theft, money protection, legal coverage, etc. This eliminates the need for purchasing a separate policy for each threat.

Importance of Shop Insurance: Explained with a Case Study

A furniture shop owner in Chandigarh had a shop insurance policy to protect his shop and its contents from common risks. In 2018, a fire damaged his shop, furniture and other belongings. The shop owner raised a claim with his insurance provider to repair the damages by submitting all the required documents, including the FIR.

He received a claim of around ₹2.7 lakhs, and an additional 9% annual interest on the claim amount for receiving a delayed settlement. This helped him recover from the financial losses and re-establish his business.

Various kinds of shops that are covered under our shop insurance plans. These include:

• Home Repair Services: Various types of home repair services, such as motor garages, carpentry workshops, engineering workshops, etc., can secure their shop against potential risks of fire or theft.

• Mobile and Gadgets Shops: Businesses that sell mobile phones and other electronic gadgets should consider investing in this insurance to protect their shops against potential losses from risks such as fire and burglary.

• General and Grocery Stores: Businesses that sell general or grocery items are also covered under shop insurance. From kirana shops and godowns to supermarkets like Big Bazaar falls into this category.

• Personal Lifestyle or Fitness Space: Personal lifestyle spaces like hair salons, spas, boutiques, etc, are also covered under shop insurance plans. In addition, fitness spaces like gyms, weight management centres, etc, are also secured against various financial risks.

• Food and Eatery Shop: Another vast business is the food and eatery sector, such as cafes, restaurants, bakeries, etc., which are also covered under shop insurance.

Also Read: SME Insurance

• Independent Shop Owners: Independent shopkeepers whose livelihoods rely completely on their shops should invest in this plan. By insuring the shop, you do not have to worry about covering any potential crises from your own pockets.

• Multiple Shop Owners: With multiple shops, the probability of risk also increases. Thus, shop insurance plans help reduce financial risks and offer adequate coverage to protect your shop in the event of adversity.

• Family Business Owners: Family businesses, such as garment shops and sweet shops, also have a legacy to maintain in addition to their finances. Investing in a shop insurance plan is the best way to protect your family’s vision.

• High-Risk Business: Shop owners who operate high-risk businesses, such as electronics shops or jewellery shops, can effectively protect their high-end investments with shop insurance from any unforeseen crisis.

• Prime Area Shop Owners: Prime area shop owners are more prone to risk than other areas because of the shop's popularity and profits. Thus, securing their shop with shop insurance is ideal.

• Your insured shop must be located in India.

• You must be an Indian citizen and more than 18 years of age.

• You must be a legal owner, tenant, lessee, or occupier of the shop.

• You must carry all the valid documents required.

• The insured shop should not be unoccupied for more than 30 days.

• Property Protection: If your shop or workshop is damaged by fire, riots, explosion or any natural calamity, our shop insurance plan will provide property protection. The amount of coverage you receive is based on your declared property value.

• Money Protection: If your safe is broken during a burglary and you lose your money, our insurance will protect you with money insurance. It protects your hard-earned money, safely stored in safes or lockers and transfers of money between the shop and the bank or vice versa.

• Liability Coverage: Another important benefit is receiving protection in case of legal troubles. For example, if a fire accident in your shop causes damage to another property, this insurance will cover the damage you are liable to pay to the other property owner.

• Burglary Protection: Our shop insurance plans will also cover burglary or robbery, which causes loss of stock, furniture or damage to your property. Under the plan, all content inside the shop will also be insured in case of loss or damage, and we will reimburse it based on the policy conditions.

Also Read: Commercial General Liability Insurance

• Waiver of Underinsurance: It is available with our Business Sooksham package and waives off the underinsurance clause if the SI is less than 85% of the total value of the assets.

• Declaration policy for stocks: Your coverage will be automatically updated as per your declaration of your stock value during the policy period.

• Omission to Insure Additions, Alterations or Extensions: If you improve or expand your shop, new additions will be automatically covered, up to 5% of your SI.

• Escalation Clause: Your coverage limit rises by a small preset percentage during the year to keep pace with price increases.

• Accidental Damage Cover Covers sudden mishaps such as dropping heavy goods or knocking over a shelf that damages your shop or equipment.

• Involuntary Betterment: When repairs need better parts than before, we cover the extra cost so you can get back to your shop quickly.

• Rent Insurance: If your shop is damaged to the extent that it cannot be used, we will pay you the lost rent or the additional rent you have to pay for alternative premises.

• Protection and Preservation of Property: Reimburses the money spent to save or secure your property, such as boarding up windows, fire-fighting charges, etc..

• Contract Works: Covers materials and work-in-progress at your shop’s renovation or construction site.

• Deterioration of Stocks in Cold Storage Premises: Reimburse the loss of perishable goods spoiled due to power failure or refrigerator malfunction lasting over 24 hours.

• New Location Cover: If you relocate your shop, including your stock and equipment, to a new location, this add-on will also cover the new premises if you inform us within 15 days.

• Brands and Trademarks: Cover the loss or damage to your shop signs, logos or branded displays for up to 25% of the Finished Good SI.

• Electrical Injury: Covers repairs of electrical equipment damage caused by a short‑circuit, overload, excessive pressure, self-heating, etc.

• Fuel Contamination During Decantation: If fuel gets mixed or polluted while transferring fuel in petrol pumps, we cover the cleaning of underground tanks.

• Wrong Fuelling of Vehicles: This applies specifically to petrol or diesel pumps and covers the costs of engine damage to a vehicle caused by incorrect fuel, as well as the cleaning of the fuel tanks.

• Terrorism: Insures damage and loss of income if an act of terrorism harms your shop.

In-Built Covers

• Additions, Alterations or Extensions: Provides coverage up to 15% of the sum insured for new properties like buildings, machinery or plants added during the policy.

• Temporary Removal of Stocks: Covers up to 10% of the sum insured for goods temporarily relocated for tasks like processing, fabrication or finishing.

• Specific Contents Coverage: Offers fixed coverage for deeds, data recovery and personal belongings for up to 20 individuals.

• Start-Up Expenses: Covers up to ₹5 lakhs for essential costs due to losses or damages caused by insured risks during the policy period.

• Professional Fees: Pays 5% of the claim amount for architects’ and surveyors’ fees during rebuilding, excluding report preparation costs.

• Debris Removal Costs: Covers up to 2% of the claim amount for removing debris, dismantling, or shoring damaged property or machinery.

• Costs Compelled by Municipal Regulations: Covers additional construction expenses required to meet municipal or government regulations.

• Sum Insured: Sum insured (SI) is the highest amount you get at the time of raising a claim. Choose a plan with a customisable sum insured based on the value of goods and content present in your shop.

• Coverage Offered: Verify that the chosen plan offers coverage to the property and the content inside the property. Additionally, ensure that various serious perils are covered.

• Inclusions and Exclusions: Paying attention to plan inclusion and exclusions is crucial as it helps you understand what the insurance policy will cover and what will not be covered.

• Ease of claims: Ensure that the claim process is quick and easy to understand. TATA AIG has a high claim settlement ratio and a team of claim experts to guide you through the settlement process.

• Affordability: Ensure that the high protection and wide coverage do not cause additional financial stress for you. Choose a plan that is cost-effective and eases your financial burden.

• Notify TATA AIG: Contact TATA AIG immediately or within 7 days via our toll-free number (1800-266-7780) or email (customersupport@tataaig.com), sharing your policy details and incident information.

• Report to Authorities: Inform the fire brigade, police, or relevant authorities based on the nature of the incident and obtain necessary reports.

• Submit Claim Form: Fill out the shop insurance claim form and submit it along with the required documents, such as loss proof and authority reports, within 30 days.

• Survey and Investigation: Work with TATA AIG’s surveyor for a detailed damage assessment and provide any additional documents requested.

• Claim Settlement: After verifying your claim and documents, TATA AIG will process and disburse your claim amount.

Note: Claims exceeding ₹1 lakh must be filed manually as per IRDAI guidelines.

• Shop Type: Enter the type of shop (e.g., grocery, electronics) to determine specific risk factors and base premium rates.

• Shop Location: Premiums vary based on the shop’s location (urban, semi-urban or rural) and presence in high-risk areas.

• Sum Insured: Select the desired coverage amount for the shop’s structure, inventory and fixtures to get an accurate quote.

• Add-Ons: Customise your policy with add-ons like burglary cover or natural disaster protection for tailored coverage.

• Deductibles: Adjust deductibles to lower premiums, balancing out-of-pocket expenses with cost savings.

Setting up and running a shop successfully requires determination and hard work. Thus, it should be well protected from risks such as fire, natural calamities, burglary, etc., especially when the number of such incidents is on the rise. TATA AIG’s shop insurance is designed to offer financial protection against such a wide range of risks and ensure that your shop runs smoothly.

With our comprehensive coverage, customisation flexibility and a quick claims process, you can focus on your business’ growth without worrying about uncertainties. Secure your shop today with TATA AIG and benefit from tailor coverage that fits every shop owner’s needs.