Who in Etsy has liability or crafters insurance and do I need it?

I did a little digging myself on product liability insurance. It was very expensive. I saw prices from $300.00 to $2000 per year for a million dollars worth of coverage.
I was thinking of getting into candlemaking and decided not to as I would definitely would want the insurance and it was too expensive. You should check into your homeowner's policy or with craft organizations and guilds ie. Check with the organizations to if they offer coverage for your type of products and it looks like you may also have join these groups as a member and pay dues to be eligible.

Posted at 8:29pm Mar 4, 2007 EST

In my other business, I routinely get sued about every two years. Frivolous or no, these lawsuits cost money, time, and a great deal of anxiety. Insurance companies do make the process considerably easier. I am sued, pass a report to the insurance company, and they handle the rest. Well worth the money at about $ 3,000 per year.

Really you need to look at what experience risk you have with the product you are selling. Soap would carry a higher liability risk due to adverse allergic reactions, harmful chemicals, risk of ingestion, and/or contact irritation. If I was a soapmaker I would definitely carry several million in product liability insurance due to the nature of the product and the pettyness of lawsuits.

As to your product, yarn, you are dealing with an inherently less hazardous product and in addition a product that is unfinished (finished products generally carry a higher litigation risk IMO as their is greater exposure to the overall population). Basically you have risks of string foreign bodies (can be very deadly if eaten), dismemberment, strangulation, and allergic reactions. I would guess that yarn manufacturers are sued very rarely (much lower than soapmakers, etc), however; so the likelihood would be small but all of those would be fairly high dollar cases. Personally if I was a soapmaker I definitely would, but if I were a yarn maker, I would if I had the cash otherwise I would make sure things are labeled thoroughly and wouldn't bother. In my experience, 98 % of people if injured by their own mistake (tripping on a crack in a sidewalk is a great example) would chalk it up to oops and will move on with their life without thought, the other 2 % uses the oops to think of ways to get financial gain by suing the city or whoever owns the sidewalk. That 2 % is an actually a figure I've calculated in my experiences with my business ventures.

I think litigation is one of the most unfortunate aspects of owning many types of businesses. Something you never realize how prevalent it is until it bites you.

Posted at 12:31am Mar 5, 2007 EST

my.rlicorp.com/Products/IBP/buy.asp
www.bombainsurance.com (sells the above insurance)

That is the type of general liability insurance they are looking for at a craft show. They want to make sure that you are covered if someone hurts themselves in your booth. I used them for several years until I started making candles - they will NOT cover chandlers, so I had to find different insurance.

If you are a soapmaker, you can also get liability insurance through www.soapguild.org/ - and they *will* cover chandlers. I have thought about switching, because their policy is actually better than the one I have, but I can pay for my insurance quarterly so it isn't a huge chunk of change all at once.

Whatever you do, DON'T COUNT ON YOUR HOMEOWNER'S INSURANCE. I don't mean to yell, but you can't count on it to cover you in the case of a claim. I have known people on soapmaking email lists who were dropped by their homeowner's insurance just because they *ASKED* about an in-home business policy for candlemaking. That all depends on the insurance company, however - I have my buildings covered under my homeowner's policy but the contents are covered under my business policy.

Posted at 12:43am Mar 5, 2007 EST

If you're going to do high end shows - by this I mean where they are highly juried and cost $300 or more on average, they will need to a copy of your insurance policy. you may even have to get the promotor (person putting on the show) listed as an additional insured on your policy. If you have a lot of equipment related to business you should also make sure this is covered within your insurance policy.

Posted at 12:49am Mar 5, 2007 EST

P.S. Ihave heard - although check with your agent on this - that you should have at least a million in coverage, and probably even two million. (I have no idea what mine is - that's what my insurance agent gets paid for - but expect to pay between $500 and $1000 a year.

Posted at 12:52am Mar 5, 2007 EST

what martinsville said--also---when I have been asked to show proof of insurance to do a new market--they have *always-without-exception* wanted $1,000,000 policy.

My "little" 100,000 policy never did do;) That's pretty standard.

Posted at 12:57am Mar 5, 2007 EST

EXCELLENT POINT Martins! My Homeowners insurance dropped me as soon as they heard through the grapevine that I was an artist and worked at home doing a business activity even tho I never see clients here. Best thing to do is get a commercial policy as your main and have that cover the building etc.

Maine is tough state to get homeowners policies anyway, Mainewoods, so be careful where you conduct your business. Many of my friends in Piscataquis Cty have home based businesses and had their homeowner insurance dropped once they found out and couldn't find anything to replace it so were forced to close shop (I think they only looked at homeowners insurance tho). My business policy is through the Hartford and was able to convince my home mortgage company that it was acceptable per their building insurance requirement so haven't run into any issues.

Posted at 1:00am Mar 5, 2007 EST

Yeah i had to tell my insurance guy exactly who would be coming by my home RE: my business. (The correct answer is hopefully nobody...) If you are doing your best to remain off the radar that may work... although in the digital age it seems my address is popping up a lot lately...

Posted at 1:03am Mar 5, 2007 EST

At some shows they do require liability insurance, usually a million. i usually just find a different show. i believe most people i do shows with do have insurance, but not because it is required. some organizations even offer a rider on their policy if you ask. sometimes art guilds, i know ohio has one, offer group insurance. if i sold yarn on etsy i don't think i would be worried about being sued, put a disclaimer about allergic reactions on your site, you know , if this yarn makes you itch, pull it away from your body. people are so dumb sometimes. I wonder how many etsy sellers have liability insurance for their products sold here?

Posted at 1:17am Mar 5, 2007 EST