Underwriting Guide
What Underwriters Ask About Retail Stores
Retail businesses face significant slip-and-fall liability from customer foot traffic, inventory theft exposure, and property risk from merchandise. Underwriters want to understand what is being sold, how much customer traffic flows through the store, and how the business manages both cash and inventory.
General LiabilityCommercial PropertyWorkers' CompensationCrime / Employee DishonestyBusiness Income
General Business Questions
What type of merchandise is sold?
Why they ask: Product type drives both GL (products liability) and property underwriting. Firearms, alcohol, and electronics all have specialized underwriting rules.
What is the annual gross revenue?
Why they ask: Revenue is the primary GL premium base for retail. It also helps underwriters assess the scale of the operation.
How many retail locations are there?
Why they ask: Each location is a separate premises exposure. Multi-location risks need all addresses, square footage, and sales data per location.
What are the business hours and peak traffic periods?
Why they ask: Extended hours and high traffic correlate with greater slip-and-fall frequency. Some carriers restrict coverage for businesses open 24 hours.
Premises & Operations
What is the total square footage of the retail space?
Why they ask: Premises size is a rating factor for GL. More floor space means more exposure for customer injuries.
Does the retailer own or lease the building?
Why they ask: Leased spaces require tenant improvement coverage. Most retail leases require the tenant to carry GL and name the landlord as additional insured.
Is there a safe on premises? How much cash is typically kept?
Why they ask: Cash on premises drives crime insurance limits. Underwriters want to know how money is handled and how quickly it is deposited.
Does the retailer sell online in addition to the physical store?
Why they ask: Online sales create products liability exposure in states where the retailer may not have a physical presence. E-commerce also affects revenue calculations.
Inventory & Property
What is the total value of merchandise inventory at peak and off-peak?
Why they ask: Inventory values fluctuate seasonally. Underwriters want to know the peak value to set proper coverage limits and avoid coinsurance penalties.
What is the value of fixtures, equipment, and tenant improvements?
Why they ask: Display cases, point-of-sale systems, and leasehold improvements are often overlooked in property valuations.
Are there security cameras, alarms, or security personnel?
Why they ask: Loss control measures reduce both theft frequency and property premiums.
Employees & Loss History
How many full-time and part-time employees?
Why they ask: WC payroll is based on employee count and wages. Retail has significant WC exposure from lifting injuries and slips in stock rooms.
Provide 5 years of loss runs for GL and property.
Why they ask: Retail accounts with frequent slip-and-fall claims or repeat theft losses indicate systemic problems.
Have there been any product recalls involving merchandise sold?
Why they ask: Retailers who sold recalled products may face products liability claims. Disclosure is required on most applications.
Answers that raise red flags
⚠High-value specialty merchandise (jewelry, firearms, electronics) without appropriate crime coverage
⚠Multiple slip-and-fall claims — especially from the same location
⚠Prior cancellations for non-payment or fraud
⚠Open after midnight without security personnel
⚠Large amounts of cash kept on premises overnight without a safe
Tips for presenting this risk favorably
✓Itemize inventory values with peak-season figures — this protects the client from being underinsured during the holidays
✓Document security measures: cameras, alarms, safe specifications, and cash-handling procedures
✓Describe products sold specifically — "retail" is not enough; carriers need to know if products are high-risk
✓Confirm whether the lease requires the landlord to be added as additional insured on the GL
✓Explain any prior claims and what changes were made to prevent recurrence
Collect all this information automatically
AgencyAssist sends your client a plain-English intake link and maps every answer to the correct ACORD fields — including all the questions above.