Dry Cleaning Industry – Insurance Best Practices

Apr 19, 2022

It feels like every month we turn on the news, we see a commercial laundry incinerating, which we find is usually due to poor housekeeping. Unfortunately, this negligence of some, has a negative impact on the wider industry, which consists of Laundromats, Dry Cleaners and Coin Laundries. One of the main negative impacts is the ability to obtain insurance. Thankfully, there are still insurance solutions available, however these require close attention to housekeeping.

In order to minimise the chance of fires occurring, we have detailed a list of ‘Insurance Best Practices’ to follow.

 

Housekeeping & Risk Management Guidelines:

 

  • Throughout the day, remove any lint or dust from the machines and the premises.
  • Ensure all dryers are equipped with built-in sprinkler systems / fire extinguishers, temperature cut off and automatic cool down cycles.
  • If the dryer doors are not opened, we recommend installing dryers with an auto tumble cycle, in order to reduce the risk of overheating and spontaneous combustion.
  • Any materials which contain oil-based products, we recommend separating these, as they require extensive cooling.  
  • At the end of each day, we recommend inspecting each area of the premises, ensuring that no items are unattended overnight and that equipment is properly shut down and switched off.

      What are some ways to improve the premises we occupy?

       

      Even if you do not own the premises you occupy, here are some additional measures that your Landlord can implement.

      • Obtain a thermographic survey, to help identify hot spots within the building.
      • If the wiring is over 15 years old, we recommend replacing.
      • Remove any insulated panels, such as EPS/PUR/PIR.
      • At minimum, install monitored smoke alarms and fire extinguishers.
      • Recommend if possible, installing a fire sprinkler system.
      • Regularly perform maintenance checks on items, such as Heating & Air Conditioning units. 

       

      If each business within the laundry industry can follow these risk management guidelines, it will help prevent significant losses from occurring and return the confidence of insurance companies. Hopefully, as the industry minimises its losses, insurance premiums will also begin to decrease.  

       

      What are some other insurance tips for my Dry Cleaning business?

       

      Many business owners focus on protecting their assets, however protecting their lost revenue is equally as important.

      The lifeblood of any business is cash flow, which is why we encourage all business owners to careful consider Business Interruption Insurance. What amount of funds they would need to survive in the event of a significant interruption to their business?

      Some of the questions we ask Dry Cleaners are;

      • How many months would it take to rebuild your property following a fire?
      • Can you temporarily operate from other premises?
      • Who will do the dry cleaning or laundry services in the meantime?
      • How long will it take to obtain new dry cleaning equipment?

       

      It is estimated that around 50% of businesses that suffer a major loss, such as a fire, do not return to their pre-loss position for at least 3 years. It is therefore important to have the correct level of Business Interruption Insurance, in order to guarantee the survival of your business.

      Each dry cleaning and laundry business are unique and require specialist advice to suit their individual circumstances.

      If you would like to discuss your insurance requirements, we recommend contacting our Insurance Consultant, Belinda Caunt.