Woodworking Shop Insurance

[Jeff Fleisher]

I recently started a small sole proprieter woodworking business. I have a detached structure that I use for my shop with about $15,000 worth of tools. I am looking for insurance coverage for both my tools and libility. I teach as well as work in the shop. I have my homeowner's insurance with State Farm but they do not have a program to cover my shop. Can you please make recommendations for insurance companies/programs that provide this type of insurance?

Thanks,
Jeff

[Brian Weick]

Try Utica First Ins Co. ~ I have my company insurance through them and have been very satisfied with their coverage and service.
Brian

[jerry cousins]

thanks for asking this. a few months ago i had that "uh-oh" moment when i realized that my home owner policy would probably not cover my detached shop - which i use for a sole propiriator business. and my homeowner policy holder also did not do small businesses. searched the i-net and found several that would cover it for xorbitant rates (search small business insurance) - now waiting on a few local brokers to get back to me - one is farmer's insurance. hoping someone knows more.

jerry

[Jim Becker]

I suggest you speak with a local independent agency that handles business insurance. They will likely represent a number of carriers and after getting a better understanding of your particular business situation, will be able to recommend the various coverages that will handle your needs.

[Tom Hargrove]

Jeff -

In my "day job," I work with small businesses on a variety of issues, including insurance. I suggest that you call two local independent insurance agents in your community to see what they have available for you.

[John Hedges]

This spurs a good question. What about those of us who use their shops for strictly hobby use. Does homeowners cover this or is a separate policy needed? Just curious what others do.

[Dixon Peer]

The suggestions about finding an agent are good ones. As to being satisfied with the "service" of an insurance company, one never knows until one has a claim. My experience with a major company was somewhat less than satisfactory. If you are sued, they say they will cover perhaps one of the "counts", but you're on your own for all the other "kitchen sink" claims the plaintiff's lawyer throws into your court. It's, "Oh, we don't cover that, read your policy". So, you end up hiring your own lawyer on your account for those "kitchen sink" claims.

Then, when it comes time to settle, you negotiate how much you're going to pay and how much your insurer pays! We all need insurance, but don't be lulled into a false sense of security just because you're paying those big premiums. Insurance is a business like any other; they're in it to make money and keep as much of it as they can.

[Charles Thomas]

The Hartford Insurance is a good one to check. I have had my business insurance with them for years. Even though I had had homeowners and auto insurance with Farmers Insurance for years, They gave me a quote that was 8 times more than Hartford which told me that they did not want this type or insurance.

[Reed Wells]

This is an excellant post. I too am looking for small business insurance for my shop. I mostly work alone and would like to know how much other people pay so I can comparison shop, with a little knowledge of what I should expect as reasonable. Anyone care to jump in with some prices. Thanks a bunch, Reed

[Steve Schoene]

I asked my homeowner's insurance company about that and they indicated I would be covered under the homeowner policy. Your mileage may differ.

[Rick Levine]

Check with a local Chubb agent. I have coverage for my home as well as my detached shop (on the same property) and they seem to have about the best coverage I was able to find. I even called another agent and they said to stick with what I have.

[Steven Wilson]

What coverage is available is dependant on where you live. This issue has been discussed at length on this site so searching the archives would be a very good idea. I checked with my agent about this a few years back and either my garage or an external building would be covered under my homeowners policy for the building structure (and things like lights, furnace, AC, etc). What wouldn't be covered would be the tools, wood stock, completed projects or the business (i.e. liability if my bookcase I built for you kills your cat). To insure the tools my agent recommended an Inland Marine policy from another company.

[Jim O'Dell]

Our home insurance is with State Farm. My wife teaches out of the house, and uses that square footage as business expense for IRS deduction purposes. We were able to get a rider policy from SF that covers her for 1 million for her business in case a child has an accident on the property. IIRC, it wasn't that expensive. Our home policy covers my detached shop and contents. If I was running it as a business, I believe I'd have to have a separate rider for it. Jim.

[Gail O'Rourke]

Hi,
My homeowners covers my shop (which I pay extra for, including my truck for commercial business)... I have liability insurance - $500,000 (I think) through AIG that costs me about $1,000.00 per year - for the cat and bookcase thing.

[Vic Damone]

If your a home owner or have other valuable assets you should look into becoming a Limited Liability Corporation or LLC and carry independent coverage on the corporation. Having untrained people using your facility could be devastating in the event of a life altering or debilitating accident.

This may sound like overkill on the surface but it's the safest way to protect your assets in the event of an accident because a million doesn't go very far these days. Also look into a two million dollar umbrella policy for all your other insurance policies. At two to three hundred dollars a year they are affordable.

Vic

[Chris McDowell]

Boy talk about erie timing. I have just been going through all of this myself. I'm swithching insurance for the business. It's $1,217.00 per year for $500,000 liability, shop coverage, tool replacement and so forth. My agent told me they have fifty insurance companies they sent a quote in to and only 2 were interested. It seems to the insurance world woodworking businesses are not that desirable to cover.

[Brian Ross]

I have my shop and business liability policy with State Farm. My tool coverage is also with them. If you have a lot of tools and no receipts make sure you have photo's to back your claim. I would call another State farm agent to make sure that the info you got the first time was correct.

Brian

[glenn bradley]

This spurs a good question. What about those of us who use their shops for strictly hobby use. Does homeowners cover this or is a separate policy needed? Just curious what others do.

The answer to that question with my policy and my attached garage was that yes, I am covered. Nothing special required. I was advised though to keep accurate receipts for the tools and although again, not necessary, taking pictures of everything will make recovery go a lot faster if, and when.

Oh yeah, don't keep the receipts and the pics in the shop so they burn along with everything else. eh?

[Darrin Vanden Bosch]

It is true that the majority of insurance companies do not want to cover a woodworking business. They seem to think that the fine dust and finishing chemicals present a explosion and/or fire hazard, which the possibility is there. As far as hobbiest go your homeowners ins. will cover you shop simply because it is a hobby, although the same hazards apply.
However there are a number of ins. companies that deal only with wood related companies. I recently got a quote from one that covered my shop, property liability both at the shop and at the shows I do. It also covers product liability to the tune of $1,000,000 for $2500 a year. I don't know if that is high or not, I am still researching it, so any info of companies that offer ins. to woodworkers is very much apprieciated (sp.)
Tried an independent broker a while back and he said he couldn't help me. (don't think he tried that hard)

Darrin

[Ed Blough]

What is going to be the killer in this deal is the idea of allowing others to use the tools. I imagine the insurance costs will go through the roof.

I knew of one attempt to do the shop/school and the insurance ate them up. I think the insurance to cover non employees in the shop was over a $1000 a month and that was in late 80's. They finally closed to the public and began making custom doors.

As for so many insurance companies not wanting to deal with work shops, the shops in my area have found if they go to guided tool tools systems
(Festool, Ezguide etc.) that the insurance companies become more interested. Also adequate dust collection and use of pure HVLP spraying equipment for finishing helps.

I agree I would set up a LLC or corporation to protect your personal assets. However I wonder if you still won't be exposed since the property is actually yours not the corporation or LLC. I would get a solid legal opinion from a savy lawyer (hard to find).

[Mark Rakestraw]

I have my shop and business liability policy with State Farm. My tool coverage is also with them. If you have a lot of tools and no receipts make sure you have photo's to back your claim. I would call another State farm agent to make sure that the info you got the first time was correct.

Brian

I'm surprised State Farm insures your business Brian. Maybe they have different rules in different states? I've had house and car insurance with them for nearly 40 years, with negligable if any claims, and they won't even cover the building I have my tools in. Nor will they cover my business liability or business property (tools). They sent me elsewhere. I pay around $2800 for liability and tool/building coverage. (Merchants Insurance Group)

[Steve Peterson]

I asked my homeowner's insurance company about that and they indicated I would be covered under the homeowner policy. Your mileage may differ.

Our homeowner's insurance has limits on coverage for many items. It may be around $3000 for tools. Jewery, art, guns, and furs are also limited.

Steve

[Joe Angrisani]

Five year old thread, guys.....

There was a more recent insurance discussion just a couple months back.

[Marc Ward]

If you are sued, they say they will cover perhaps one of the "counts", but you're on your own for all the other "kitchen sink" claims the plaintiff's lawyer throws into your court. It's, "Oh, we don't cover that, read your policy". So, you end up hiring your own lawyer on your account for those "kitchen sink" claims.

This is total nonsense.

[Marc Ward]

If your a home owner or have other valuable assets you should look into becoming a Limited Liability Corporation or LLC and carry independent coverage on the corporation. Having untrained people using your facility could be devastating in the event of a life altering or debilitating accident. Vic

If you think this will protect you, you are naive.