I recently started a custom cabinet shop out of my home, and am having trouble getting liability insurance. The four or five companies I talked with claim cabinet or millwork shops are difficult to insure, especially one run out of the home. Any suggestions?
Discussion Forum
Discussion Forum
Up Next
Video Shorts
Featured Story
This compact detatched accessory dwelling has an efficient layout with a vaulted ceiling that enhances the sense of space.
Featured Video
Highlights
"I have learned so much thanks to the searchable articles on the FHB website. I can confidently say that I expect to be a life-long subscriber." - M.K.
Replies
Go see independent insurance agent or insurance broker. Let them find (look) for the company for you. Don't waist your time talking to a captured insurance agent.
Or talk to a captured Erie agent if they're available in your area....
I just talked with my agent on upsizing my policy from $300K to 1 mil ....why I hadn't done this years ago still has me wondering ...I've bumped it up before but for some reason never paid attention to how cheap the upgrade would be.....$90/yr!
While I had him on the phone I asked about all the horror stories I read on FHb.....he said lots has to do with companies heavily invested and insuring in NY after 9/11 ...and even companies that didn't insure there .....but held property investments in NYC ......
He said if I had 10 or more employees...he's not be able to talk to me.....5 to 10 he'd have to fill out the papers and wait for their answer.....1 to 4 ....he could write it up as he saw fit.
Actually I could have me plus 4 employees and he'd sneak it thru ....
So as a sole prop/no employee I'm good to go ...and even if I hire a guy I'd run just an extra $350 or so to add him on.
Said not to extect any major rate hikes .....not to get a letter saying they're dropping anyone ...none of that bad stuff I've been reading about.
Jeff
Buck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite
Why would working out of your house affect you liability insurance.
Liability insurance would not protect your house anyway.
Liability insurance is if you damaged a customers home while installing them.
I agree with all of your questions. I live in Michigan, and have talked with six agents so far, most of them independents. They all tell me that cabinetmaking / millwork businesses are difficult to insure.
I'm having a hard time unde4rstanding why you need liability ins for cabs in your own home. If you have customers comuing in with their kids whilke the trablesaw is running maybe. or if you will be spraying lacquer while the wife is having friends over for coffee and cigarettes maybe.
But the only liability that you would incur is from installing cabs in someones home. Are you installing too or just building them?
Go do an installation and drop the cab or a tool on a nice wood floor and you might have a claim. Install them with sheet rock screws and let them fall off the wall on a liitle kid and you might need the liability insurance.
But - if all you will do is build the boxes and doors in your own home with no customers on premises then no insurance should be needed, IMO
Excellence is its own reward!
Could it be the insurance company he has his home owners policy with found out he has a commercial wood working business in his home and they now want to cancel unless he get that insured separately.
That may well be.
But that is not liability insurance.
It would be property causaulty insurance.
Basically the same as the homeonwers insurance property and contents coverage, but rated for the business usage.
That could be too. Mine is happy to know that my business happens in the shop and that I don't entertain the public in my office.
They say it's OK if a client stops in occasionally but maintaining a "storefront" type operation for walkins is problematic for them..
Excellence is its own reward!
Are you sure your not talking about workmans comp. Liab really has nothing to do with the home bus.
Men do not quit playing because they grow old; they grow old because they quit playing! Holmes Sr. Oliver Wendell
I am sure what I'm asking for, but I might be asking for the wrong thing. I make cabinets in my home, and operate in a dedicated workshop and office. My company is a Limited Liability Company (LLC) in Michigan. I do not have any retail space. I want insurance to cover liability, along with replacement value of my tools. All of my tools, except installation tools (drill / driver, etc.), remain in my shop, so I don't really need the "inland marine" insurance to cover "travelling" tools. The sticky point seems to be the "millwork" part of my business. Maybe I should start over and tell the insurance agents I am a general contractor. Maybe I should move out of Michigan.
You are really looking at two different types of insurance.
You want liability insurance to cover you when you do installations.
I don't know what classifications that they use, but cabinet installe, trim carpenter, finish carpenter would be more like what you are doing. That is to cover any damages that you might do to the customers house or even a 3rd party such as burning down the customers house and the house next door.
The other insurance that you want is property casualty insurance on you building and tools. That is to pay you if they stolen or if you have a fire.
I am not sure of the classificiations, but millwork is problably designed to high volumne milling, with lots of dust and possiblity of explosions.
" I make cabinets in my home, and operate in a dedicated workshop and office"
If that space is a detached building them you are not "operating out of your home", even if it is on the same property.
I suspect that you might have the wrong agent. You need one that knows these differences and find the best match for you.
I suspect that you might have the wrong agent. You need one that knows these differences and find the best match for you.
I think U just cleared this whole thing up!
JeffBuck Construction Pittsburgh,PA
Fine Carpentery.....While U Waite