Iwas one of these people who felt secure having a home based business andbelieving that it was covered under my homeowners insurance. It wasuntil I heard horror stories about studios getting flooded (during and after Hurricane Katrina), seeing firsthand neighboring craft canopies going airborne and crashing down ondisplays, and the dreadful theft issue that made me really look at whatdoes my homeowners insurance cover when it comes to my home basedbusiness. Here's what I learned that EVERYONE needs to know when itcomes to insuring your business.
Question #25 – Why do I needinsurance if I already have homeowners insurance?
First,homeowners insurance does cover some home based businesses, but I stressit is just SOME. It doesn't cover what you do away from the business –while on your way to shows, at shows, and equipment/display furnituretoo. It is one thing to have a garage sale in front of your home andsomeone accidentally injures themselves testing out a saw – here you arecovered. However, if you have a fire in your house insurance will onlycover basic stuff – furniture, computer, etc NOT your work, your rawmaterials, your display furniture and so on. Let's say you are at ashow and while you weren't looking you noticed several sets of jewelrysprouted feet and walked away. Not I am not a jewelry artist but I doknow finished jewelry precious metal pieces don't typically cost $20 orso. Your homeowners insurance won't cover it. Why you ask? It isbecause the theft didn't occur in your home.
Better to be safethan sorry. More and more shows are requesting proof of businessinsurance mostly because promoters know we are living in a lawsuit happyworld. If a customer trips in your booth and sprains their ankle, restassured they will go after the promoter and the artist to get what theycan for pain and suffering – not that we would like to think peoplewould do that. It happens and this why you can't risk loosing a ton ofmoney – when many of us artists are really on a shoe string budget,living from show paycheck to show paycheck. Customers see you as abusiness and businesses are expected to have insurance – those thatdon't, oh well, tough luck!
When it comes to finding insurance dolook into what your homeowners insurance does cover first. I learnedthat if you let your insurance company know you do run a home basedbusiness from your home you might be covered for more than just the lossof some equipment. The next thing is to look into what art/craftbusiness insurance companies are out there and compare prices and whattheir insurance covers. One popular one is RLI Insurance who advertisesin many art/craft publications. Look in show listing directories orthrough CERF's website for leads to others. Insurance, for one year,can be as low as $250 a year. There are companies that offer coveragefor one day (while at a show) which is far better than nothing at all,yet can add up to far more than $250 a year.
The point thatchanged my mind from relying on homeowners insurance and get businessinsurance is when I started selling my work in stores and adding candlesto my product lines. When there is more risk for injury (on my part orthose who receive my work after it leaves my hands) I couldn't avoidit. Granted 2D art might not hurt anyone, but it can get damaged, andthe risk goes higher for those who work with glass or pottery. All ittakes is a gusty day to knock down a display full of your precious work.Have you ever asked those who have had this happen to them, if theyhad insurance? More times than not, when I ask, they say no, butquickly realize today is the day “this” won't happen to them again. Forme, and I am sure I am sure I am not the only one, “you” will think itwill never happen to you, but all it takes is that one time to realizehow foolish it was to think that. Don't wait, but look into gettinginsurance now – you can't afford not to (especially if you find you areon a tight budget). All it takes is a wind storm to twist your canopy,theft, or someone injuring themselves to find $100 - $500 a drop in thebucket compared to the other costs that can be incurred.
Now Iam sure you have some stories about how you saw damage at a show orpersonal experiences that convinced you to get insurance. Please sharethem! The more people learn from others mistakes, the reduction insimilar mistakes will occur. Thanks for reading this long winded post,but I strongly feel it is something that needs to be talked about on amore regular basis. Have a great week everyone! Michelle Sholund,www.quickcraftartisttips.blogspot.com
