Are you a bit crafty? Have the panache for making beautiful things?
Decided to sell them on Madeit, Etsy, local markets, online, take it global or to family and friends? One thing you may have forgotten, ignored, or deemed unimportant, is insurance!
Having public and products insurance protects the public from something your product or you might do to harm them (accidentally of course). For example, if you make a food product and it makes a lot of people sick due to you not refrigerating it correctly, someone might put a claim in against you. Your insurer will defend a claim or perhaps even pay out on the claim for you.
Insurers are especially concerned when products are for children, babies or the frail. An insurer will also be concerned and ask you a lot of questions about your products if the products are intended either to go on the skin or to be ingested. They will question the dyes used, in case they cause reactions. They make sure food products and cosmetics are of Australian standards. They look for objects that may dislodge and cause a choking hazard.
Insurances You May Need
LIABILITY
Liability is first and foremost as this usually also includes product cover. This covers you if your product or you do something that injures another person. Your beautifully handmade body butter, due to you getting the recipe wrong, may burn someone's skin. You have a potential claim right there. It's a misconception that if you just sell online, you won't need public liability insurance, you will as it also covers product liability.
Do you do markets? Most market organisers will require you to have public liability to attend. Some markets offer that you can buy public liability cover for the day. Just remember this cover is for things like, if your table cloth trips up someone and injures them; it's not covering your products and the liability they should have on them. Market liability is usually just whilst the market is on.
BUSINESS COVER
Your home-grown business has grown! If you keep stock at home, many home insurance covers do not cover any business activities or stock. Your stock or the equipment you use to make your products will need to be insured under a business policy to have them correctly insured.
If your business has now expanded to have its own premises, you may be liable for insuring the building, landlord's liability, glass and loss of rent as part of your lease. Read your lease! Ask your solicitor and insurance broker.
OTHER COVERS UNDER A BUSINESS POLICY
Insurance for money, theft, glass, equipment and breakdown. If you have fridges and freezers you rely on, cover for equipment breakdown is a good idea. You can even insure the loss of the stock, if they breakdown.
Government Compulsory Insurances
GOING TO EMPLOY STAFF?
It's a legal obligation to have Workers Compensation Insurance if you have staff. Some states have the same rates regardless of the insurers, and in some states the prices vary. Seek out professional advice.
Minimise Your Risks
You can also reduce your risk with good policies and procedures. Does your product meet the relevant Australian Standards? Have you had it looked at by a third party? Keep good documents on suppliers, where your raw materials come from. Feeling a bit lost? Finding it all too confusing? Remember insurance brokers are here to help YOU. Brokers don't charge for quotes or the advice and recommendations they give you. You will have the best policies for your business and you. You can have different payment options and you will have us to help when it comes to making claims. You can be put in touch with other professionals to help you in business such as an accountant, solicitor and bookkeepers. Remember - Having the right insurance is no accident.Words by:
Insurance Broker & Allsure Co-Director,
