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Small business insurance

Hi all,

I’m moving to a larger city and want business insurance that covers equipment and product in case of accident or burglary. I am a renter, and in Oregon, and my studio will be in my basement (with landlords’ blessing). Does anyone have any suggestions? My Google searches are coming up with insurance for handymen or restaurants, and I’m unsure if my renters insurance would cover jewelry equipment, materials, and finished product.

Thanks!
P

Hello Paulab,
If you can bring yourself to read through your policy, it has to spell out what is covered and what is not. However, you should be able to get an answer from your insurance agent. That said, usually renter’s insurance is for homes and only covers your belongings and furniture…it even does not cover any jewelry, guns, equipment, musical instruments, etc., beyond a certain amount. The standard way of adding possessions that are valued beyond that amount is by adding a “rider” to the policy, which specifies the exact items you are insuring (such as your major tools) and assigns them a replacement value. The rate for this is determined by an insurance table at so much yearly premium per thousand dollars of value. So if you have a lot of equipment, this could run into a lot of money. Also, I’m not sure whether renter’s insurance would cover a business at all…a hobby, maybe, but probably not a business…so you might need a separate policy for the business. I’d suspect that the renter’s insurance for a home would exclude anything you use in a business…and the business insurance not cover the things in your home. Long story short, unless you can call what you are doing a “hobby” you probably will need two policies. Call some insurance agents. Be sure to discuss the fact that you are using a jeweler’s torch and that the business is in the basement of a home. -royjohn

Hi Paulab,
Royjohn is absolutely correct. Your renters policy won’t cover expensive jewelry making equipment. They fall into a “special collection” category with a cap on total replacement value. Also, renters insurance is less expensive than homeowners insurance because you are only insuring contents, not the structure. If you start looking into a rider policy or even a business policy, be wary of those bundle everything and save plans. They are usually a bit less expensive because either the deductible amount is very high or the deductible is a percentage of the replacement value. I have earthquake insurance, so any claim filed against the policy, for any reason, carries a 10% deductible. Also, a claim on one part of the policy affects the premium for all attached policies/riders. A car accident can increase your entire policy premium across all policy lines. Before you start, take a hard inventory of your materials and equipment, calculate the depreciated value on used equipment and tools, and assign a replacement value on each one, this is the same process used to file homeowner claims. This will give you a hard dollar amount that you need to have coverage for as well as the replacement cost in the event of a loss. Also, ask about having flammable gasses (torches) on the premises. A policy may be voided if a loss is caused by an ignition source(s) they were not informed about. If the structure itself is damaged you may be held responsible for the entire bill. Ask a lot of questions. If you missed a question, or didn’t understand something, go back and ask for clarification, then take those same questions and numbers to the next company. It’s a lot of work, but it will save you from being over or under insured. If you keep those lists, they will be invaluable if something ever does happen.
Good Luck! Alaska Silver

Hi,

as an aside, if you end up doing a valuation of your business property, you might want to also research Oregon’s personal property tax, as applied to business property…

julie

Many communities have strict zoning ordinances about having a business in a residential zoned area. So make sure your in a place that will allow that before you sign a lease.

I also have serious doubts (sorry) that you can get insurance if you’re working with flammable gas under pressure (especially oxygen). I use an oxygen concentrator which is very safe, but I am in my own house so I didn’t fess up with my insurance carrier. I am sure that any fire/damage ever caused by soldering equipment would certainly void my insurance policy and foul my claim. All this being said, I am in Florida and Oregon is more liberal. You may find it more open to the arts.