Bought a Print Shop? Insurance to Check First

Start by confirming what the seller left in force and in whose name, because a new print shop owner usually needs general liability, property insurance on the presses and stock, workers' comp and, if the shop delivers, commercial auto. Then check three print-specific items: customers' paper and artwork in your care, customer mailing files, and money held for others. This guide is for buyers of commercial printers, quick printers, wide-format shops and mailing operations.

The short answer

Confirm four things on closing day: which policies are in force, the named insured on each, the equipment and stock values, and who the lender or landlord is on each policy.
A press is an expensive machine in a building full of paper and solvent. Property values, equipment breakdown and business income decide how a bad week turns out.
Most print mistakes cause money loss rather than injury, so a standard general liability policy is only part of the answer. Ask how the policy treats reprints and customers' property.
Workers' comp, auto and cyber each have print-specific traps: class wording, delivery payroll and customer mailing files.
A quote or an application is not coverage. Coverage exists only when the carrier binds the policy.

What are you actually insuring when you buy a print shop?

"Print shop" covers businesses with different exposures. Trade press on print deals treats commercial printing, packaging, wide-format and direct mail as different businesses, and says direct mail depends on data management and postal expertise. A shop with offset presses, a bindery and a delivery van has a different program from a digital quick printer with a counter, and both differ from a mailing house that holds customer lists and postage deposits.

It also matters what you bought. If you took only customers, salespeople and a few machines, you may inherit less of the seller's insurance history, though workers' comp experience can still follow a partial purchase, depending on whether the seller's insurer can split out the data for the part you bought. If you bought the whole company, you inherit the lease, the machines, the loss history and the habits, so treat the seller's policies as a starting point to test against the shop you now own.

Start by writing down your real mix: offset or digital, plate-making in house or outsourced, bindery and finishing, wide-format, mailing, delivery, and any installation away from the shop. Each line changes which policies matter.

What each kind of print shop may add to the program
Kind of shop	What it may add, as a question to confirm
Digital quick printer with a counter	Does it fit a business owner's policy (BOP), which packages property, business income and liability, and how are customers' files and walk-in customers treated?
Offset plant with a bindery	Is equipment breakdown covered, is comp payroll split between press and finishing, and how are forklift use and paper stock handled?
Wide-format or sign graphics with installation	Is installation away from the shop on the application, rated separately for comp, and picked up by the auto and liability program?
Mailing house	Are postage deposits under crime cover and mailing lists under cyber cover?

Which policies should be in force on closing day?

Use this table as a first-week checklist. It names the standard coverage for each exposure and the print-specific point to confirm. Policy wording varies by carrier and form, so read your own forms.

Print shop insurance stack by exposure
Exposure	Policy to confirm	Print-specific point to check
Injury or damage to others, completed work	General liability	The standard form has a products-completed operations hazard with its own aggregate limit. Printing errors usually cause financial loss, which is a separate question (see the gaps guide).
Presses, plate-making and finishing equipment, stock, contents	Commercial property	Valuation basis (actual cash value or replacement cost), coinsurance and whether limits came from the seller's book values.
Press or controller failure	Equipment breakdown	Whether it is in the property policy or an endorsement. Presses are electromechanical.
Lost income after a fire or breakdown	Business income and extra expense	The standard form starts business income after a 72-hour wait, needs direct physical loss, and does not pay for a lost customer.
Employee injuries	Workers' compensation	State law decides who must carry it. Class wording, payroll groups and the ownership change report.
Delivery vans, employees' own cars on errands	Commercial auto with hired and non-owned auto	General liability excludes auto. A shop that only sends staff on errands still has the exposure.
Customer files and mailing lists	Cyber	Usually claims-made, so the retroactive date (the earliest work the policy covers) matters after a purchase.
Postage deposits, employee theft	Crime	Whether the form responds to losses discovered during the policy period (discovery) or losses that happened during it (loss sustained), and whether funds held for customers are covered.
Solvents, inks, fountain solution	Pollution liability (if bought)	The general liability pollution exclusion removes coverage for many irritants and contaminants. Ask how it is worded.
Large claims above the primary limits	Umbrella or excess	Driven by customer, lease or lender requirements. Do not assume it extends to the shop you bought.

Do the seller's policies still cover you?

Often not as written. A liability or property policy cannot be handed to a buyer without the insurer's written consent, so an asset purchase usually needs your own policies effective at closing. In a stock or membership interest purchase the company stays the insured, but the carriers still need to hear about the change.

A new acquisition LLC is not covered automatically either, because the standard Insurance Services Office (ISO) general liability form carves LLCs out of its limited newly acquired organization provision. Match the named insured (the legal entity the policy protects) to the entity that now owns the shop. If your presses or wide-format printers are leased or financed, the lessor's or lender's insurance terms follow each machine, so list every machine against its financing before you compare policies.

Workers' comp has its own clock. An ownership change generally must be reported within 90 days in National Council on Compensation Insurance (NCCI) states, and North Dakota, Ohio, Washington and Wyoming run state funds with their own rules. See workers' comp and payroll for a print shop. Our guides on wrong named insured and keeping the seller's insurance or starting over walk through the fixes.

Is the press insured for what it costs to replace?

Under the standard ISO property form, covered property is valued at actual cash value unless a replacement cost option applies, and replacement cost is not paid until the property is actually repaired or replaced. A purchase price is not the same as insurable value, so a limit carried over from the seller's book values can be too low. Coinsurance can then reduce a claim.

A hypothetical example. Solvent-soaked shop towels sit in an open bin overnight and ignite. The fire damages a four-color press and a pallet of paper. Suppose the seller's schedule lists the press at $150,000 on a depreciated basis, a replacement would cost $400,000, and the policy pays actual cash value. The payment would reflect depreciation, not the price of a new machine, and, under the standard form, the business income clock would not start until the 72-hour waiting period passed. The lender's equipment lien would also matter: the loss payable wording decides who gets paid and in what order. None of these numbers is real, and your policy wording controls.

Federal hazardous waste rules list spent solvents such as acetone, toluene and methyl ethyl ketone as hazardous wastes with an ignitability hazard code, and solvent-soaked rags are an obvious fire concern. That is one reason a property insurer may ask how a shop stores solvents and handles used wipes. For how storage and safety controls can affect price, see what drives insurance cost for a print shop.

What do lenders and landlords add?

If you borrowed through a Small Business Administration (SBA) 7(a) loan, your presses and finishing equipment are probably the lender's collateral, and the lender will usually expect them insured at full replacement cost with a lender's loss payable clause on the policy itself. Check that the equipment list you gave the lender matches the property schedule, and that any leased machine is insured the way its lessor requires. Landlords and customers add their own insurance terms. The clause detail is in contracts, licenses and bonds for a print shop and SBA lender insurance requirements.

What should you do in the first 30 days?

Get an equipment list with ages, serial numbers, leases, lender liens and service contracts, and compare it with the property schedule.
List the customers' property you hold: paper, artwork, proofs and finished goods awaiting pickup. Then read the policy's wording on property of others.
Ask which workers' comp class the seller used, the experience mod and the last two audits.
List who drives for the shop and in what vehicles, including staff who use personal cars.
Collect declarations pages, the full policies with every endorsement, and five years of loss runs.
Pull your lease, loan documents and top customer contracts, note each insurance clause, and ask the broker to confirm in writing which policies are bound, on what date, with what named insured.

The insurance checklist for buying a business, your first 90 days and the guide to documents for an insurance review expand each step. Send Morrow the declarations pages and equipment list and it can flag what looks stale. Carriers decide terms. Our guides to coverage gaps, workers' comp and payroll and choosing a broker cover the rest.

Keep reading

Frequently asked questions

Do I have to carry workers' comp for my print shop employees?

State law decides. Texas lets most private employers choose not to carry it, and North Dakota, Ohio, Washington and Wyoming require buying it from a state fund. Your loan documents may also ask for proof of coverage, so check them.

Does the seller's insurance transfer to me when I buy the shop?

Not by itself. A policy cannot be transferred without the insurer's written consent, so asset buyers usually need new policies. In a stock purchase the company keeps its policies but the carriers still need notice of the ownership change.

Does general liability cover my customers' paper and artwork?

It depends on the wording. The standard form excludes damage to personal property in the insured's care, custody or control, and courts apply that exclusion case by case. Ask your broker how your property and liability forms treat customers' goods.

Can a business owner's policy cover a print shop?

Some small shops may fit one, but eligibility depends on the carrier and the operations. A business owner's policy generally does not include workers' comp, auto or professional liability, so you would still need those separately.

Is a quote the same as being insured?

No. A quote or an application is not coverage. Coverage starts only when the carrier binds the policy, so get the effective date and named insured confirmed in writing.

References

Just bought a business? Get your insurance reviewed.

Send Morrow the declarations pages, loss runs and key contracts you inherited. Morrow can review them against the business you bought, flag gaps and request quotes where it makes sense. Any new terms depend on carrier underwriting.

Request a review Check a contract

Morrow · 25 New Chardon Street, 4th Floor, Boston, MA 02114

This article is general information, not legal, tax or financial advice, and not a coverage determination. Coverage depends on the actual policy wording, carrier underwriting, your purchase agreement and your contracts. Ask your attorney and accountant about deal and legal questions.

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