Regardless of the size of your vending machine business, there are always a few tasks that need to be completed. Doing so can be daunting, especially for small-business owners. It’s not surprising then that many of them rarely have the time to think about their vending insurance needs. Below is a list of some of the different types of insurance available to vending machine business owners.
Types of Vending Machine Business Insurance
With the increasing popularity of vending machines, it’s easy to expand a small business’ reach and diversify its offerings.
Since a vending machine offers a wide variety of products and services, having the proper insurance coverage can help protect the business.
General Commercial Liability for Vending Insurance
One of the most important factors you need to consider when establishing a successful vending machine business is general liability insurance. This type of insurance protects you from being sued even if it’s not your fault. It can help cover the cost of a lawsuit if the other person believes that you were negligent.
Average Cost: This type of insurance can be paired with another policy to provide additional coverage. It typically costs around $300 to $1,000 annually.
Having the proper insurance coverage can help protect you from any liability issues. It can also help cover the medical expenses of your customers. It’s also not unusual for building owners and managers to require that operators carry liability insurance – if you are using a vending machine locator, make sure they due their due diligence and find out any insurance requirements.
The general liability insurance for vending machines covers the various risks your business might face, such as the injuries you might get from a client while using your machine.
It also protects against lawsuits related to the unauthorized use of a trademarked product or false claims in advertising.
One of the most effective ways to keep track of your inventory and expiration dates is through vending machine management software. This type of software can help keep track of your machine’s details and prevent you from getting sued due to food poisoning.
Commercial Auto Insurance
Vending machine operators typically use this type of insurance to protect their cars and trucks when they’re on the road to install new machines or refill existing ones. However, this type of insurance doesn’t cover commercial use.
Average Cost: Depending on the type of vehicle used, the insurance cost can vary. A business vehicle insurance policy can cost around $900 to $1,200 annually.
Commercial auto insurance typically covers:
- Covers vehicle damage in the event of a collision with another vehicle.
- In the event of theft, a Commercial Auto Insurance policy protects you.
- When you’re in an accident with a driver who doesn’t have insurance, this coverage protects you.
- This insurance covers your medical bills.
In most circumstances, when a car is utilized for commercial reasons, personal auto insurance coverage will not cover an accident.
Workers’ Compensation Insurance
While it is important to protect employees from harm, proper training and supervision can also help prevent an accident. Having the proper insurance coverage can help minimize the risk of injury and liability.
Average Cost: Workers comp can help pay the medical expenses of those sick due to an accident or illness. It can also help cover the lost wages of those who are unable to work due to their conditions, and it can cost roughly between $2,000 to $3,000 annually.
Workers’ compensation insurance is a type of insurance that provides financial assistance to employees who get injured on the job. Falls, broken bones and concussions can all happen while moving products from one place to another.
Workers’ Compensation Insurance typically covers:
- Medical expenses
- Lost wages
- Injury & Sickness
Cyber Liability Insurance
One of the biggest risks that vending machine operators face is the unauthorized chargeback fee that they might be charged. This can be a huge issue for them, affecting their entire business.
Average Cost: A cyber liability insurance policy can cost around $800 to $1,500 annually. It can provide coverage for up to $1 million, depending on the type of policy and the deductible.
If a credit card transaction has been made using a machine that doesn’t have an EMV-capable credit card reader, the operator is liable for the unauthorized transaction.
If your machine accepts credit cards, then cyber liability insurance is a good option to consider. Although it’s very unlikely that your customer’s personal information will be stolen due to a cyberattack, it can still protect you from liability issues.
How to Get Your Vending Machine Business Insured
If you’re not sure what type of insurance is right for your company, it’s important to find a licensed insurance agent or broker who can provide advice and guidance on the various aspects of your insurance needs.
A licensed insurance agent or broker is a person who acts as an intermediary between you and an insurance company. They are required to follow all laws and regulations regarding selling insurance.
Some of the reputable insurance company includes:
While an agent is an extension of an insurance company, a broker is independent and can represent the buyer instead. The exact cost of insurance depends on the size and scope of your business.
For instance, if you have annual sales of around $100k, your general liability insurance premium should range from $400 to $500. Luckily, if you’re looking to place your first vending machine, your insurance costs will be a lot lower.
Some insurance companies will also provide additional coverage for your machines. The cost of commercial vehicle insurance depends on the type of vehicle and the driver’s record.
The cost of employee insurance varies depending on the number of workers your company has. For instance, if you have 50 employees, the employee insurance premium might range from 3% to 5% of the salary.
There are also subscription-based plans that can provide additional coverage for your business.
Why You Need Insurance for Your Vending Machine Business
If you’re a vending machine business owner, you might find yourself liable for various issues that customers might have. Or laws might change, and something like an alcohol vending machine might become illegal.
Aside from these, you might also be sued for various other reasons that are not reasonable to you. Having the proper insurance can help keep you focused on your business. Especially if you are vending high value items like art, or the machine itself is high end, for instance, it is a vending machine with augmented reality features, or a robotic pizza vending machine.
Although it might seem like a safe bet to place your vending machines outside, they are still vulnerable to vandalism.
No machine is designed to withstand the elements and can easily be stolen or destroyed. Aside from this, you might also get hit by credit card fraud or machine breakdown.
Leptonic is standing by to help with your vending machine journey.