Calling all home working jewellery makers - insurance help needed!

[LondonJax]

Argh, just as I thought it would be safe to launch my teeny, weeny on line silver stamping business...

I've been scuppered by home insurance.

A, I hope, brief update on my situation.

We have normal, family contents and buildings insurance with an insurance company (a supermarket brand). It covers all the usual contents, accidental damage, building burning down etc. It's coverage for "working from home" is the usual - occasional admin work or full time office based work only.

I, obviously, need something to cover my stock, tools, equipment plus the product liability and, possibly, public liability at some stage - so I am working on that.

Now, most of the craft insurers recommend you check with your home insurers to see if you have any coverage under your home insurance - they always say it's unlikely but worth asking.

So I asked. Thank goodness I did. As I expected, my work tools and stock are not covered. However, the underwriters have also said that, if I set up my business from home, I invalidate the whole policy. So, whilst I can get cover for my jewellery stuff from the craft insurers, if we get burgled and they take the TV my current insurer won't pay out for it as working from home invalidates my non business coverage, whether they take my silver or tools or not. If the building catches fire I will have no buildings insurance as that's invalidate because my 'studio' is my spare bedroom (even though I solder in the garage which has the usual 'burn time' associated with attached garages - just in case the car catches fire when it's in there, usual stuff). I asked if it would make any difference if I set up in the garage completely - even though it's freezing in there. Nope, it's covered by the buildings insurance and that's invalidated by my working from home.

Now, I have done a few on line quotes and putting in jewellery maker, gold/silver smith etc seems to bring up the same answer from all the high street insurers - can't cover your home. I even, out of curiosity, put in my friend's home occupation (florist), can't get home insurance with that home occupation either! So this obviously a "thing" - you invalidate your contents and buildings insurance if you work from home in anything other than general office admin.

So how do you home working jewellery designers and makers get round this? Should I be going down the route of insuring my home as my business instead? How does that work? Or are there other insurers out there who will insure ALL my contents and my house whilst giving me the extra coverage for business contents/stock and the public/product liability?

At the moment I am having to hold out on launching as I can't risk my business invalidating insurance claims for my home.

Any advice would be great! Thank you.:(|

[china]

You will most likely need two separate policies.

[LondonJax]

Yeah, I'm trying that. The current insurer is basically saying, even with a separate policy to cover my business, the fact that I work with silver at home will invalidate my home contents cover. Time to try to find a separate contents insurer. But a few of the high street ones seem to have the same policy - if you're not just doing admin work at home you're likely to invalidate your home contents cover. But I am up to a challenge!

[pearlescence]

It's absurd. Bad assessment of risk. They don't understand it so run. And can you imagine the reaction when I said some customers come here too?
Sell a few items regularly on eBay and there goes your house and contents insurance.
The British Pearl Association is looking into the whole insurance thing for home pearl peeps

[ps_bond]

When LV were told about the jewellery making, they cancelled the policy on the spot. Not impressed. I'm not the only one they've done that to - work from home, fine, but if you actually make anything (so any & all crafts) they aren't interested.

I'll dig out my policy details later (can't remember who the company is), but it covers me for pretty much everything needed *and* house & contents. None of the usual craftwork policies covered me; several of the more specialised ones pulled stunts like "you can make jewellery, but you can't solder". Mention of the laser welder freaked them out too.

[Lucie]

I few people I know who make similar types of jewellery in silver, don't say they're working from home at all - they just say the equipment and tools are for a hobby.

Lots of people have expensive hobbies! If you're not earning enough to qualify for tax or likely to get sued by a customer, is it really neccessary to declare it at all?

Somebody will probably correct me ;) but as long as you're not going to have stacks of gold sheet or hundreds of pounds of commissions sitting around, the insurance company seems to be massively over-reacting.

[ps_bond]

I few people I know who make similar types of jewellery in silver, don't say they're working from home at all - they just say the equipment and tools are for a hobby.

Lots of people have expensive hobbies! If you're not earning enough to qualify for tax or likely to get sued by a customer, is it really neccessary to declare it at all?

Somebody will probably correct me ;) but as long as you're not going to have stacks of gold sheet or hundreds of pounds of commissions sitting around, the insurance company seems to be massively over-reacting.

Yes, you do need to declare it to them; if there's an incident, they will look for any and every reason not to pay out and if you've not declared something they reckon you should, it will invalidate your entire policy and they'll gleefully refuse any payout.
Most mortgages require buildings insurance as a condition of lending so they can be sure of getting their money; if the house burns down and you abruptly find you're not covered, you're in breach of contract with them (at a time when the extra aggro might not be entirely welcome). Hopefully a low probability, but it's there.

Not a fan of the insurance industry.

[Aurarius]

the insurance company seems to be massively over-reacting.
Insurers prosper by taking premiums from clients who are as low risk as possible. The industry has changed a lot from thirty years ago, when you could generally rest assured that you were actually insured against the worst happening. Today, thanks to increasingly sophisticated and exclusionary policy T&Cs, more and more people who think they're insured against such and such an eventuality actually aren't. And if you're one of that unfortunate group of people who've had to make a claim for subsidence or flooding at their property you have the joy of discovering what it's like to be uninsurable thereafter, and then the additional joy of discovering what that pariah status does to the marketability of your property when you decide you want to sell it.

[Lucie]

How about if you work out of your garage (not attached to your home). Does anyone know if that makes a difference?

[Lucie]

I knew someone would probably correct me. Thank you for the clarification Peter.
I've got some friends who'll appreciate the info.


Yes, you do need to declare it to them; if there's an incident, they will look for any and every reason not to pay out and if you've not declared something they reckon you should, it will invalidate your entire policy and they'll gleefully refuse any payout.
Most mortgages require buildings insurance as a condition of lending so they can be sure of getting their money; if the house burns down and you abruptly find you're not covered, you're in breach of contract with them (at a time when the extra aggro might not be entirely welcome). Hopefully a low probability, but it's there.

Not a fan of the insurance industry.

[ps_bond]

FYI, my policy is with Ageas (via a local insurance broker) and is fairly comprehensive - buildings, contents, stock (+ in transit), public liability etc.; I've remarkably few restrictions all told.

[enigma]

I don't bother,house insurance is a total rip off anyway.
I do wonder what public liability we should have though? What sort of things have people been sued for?

[mizgeorge]

I have the GJD gold membership for public/product liability, which seems pretty comprehensive.

As for having a home studio, it's worth having a chat with the NFU mutual - they're used to dealing with lots of different home/working environments and seem to take a rather more pragmatic view than the average off the shelf insurer. They're pretty competitive as well - significantly so for listed buildings.

[ps_bond]

I don't bother,house insurance is a total rip off anyway.

It's a rigged game.

For a lot of things, self insurance makes sense - if you've got the capital to back it. For some, there are requirements to have recognised insurance in place.

[enigma]

I agree Peter all insurance is a rigged game.
I only bother when there is a human injury/death liability element really as thats what gets really expensive.
I just struggle to see that exists in selling jewellery?

[ps_bond]

I can think of all sorts of potential for injury with jewellery - usually involving misadventure (and that's ignoring the making risks!). Earrings that snag & tear a lobe, instead of failing at a "safe" (completely nebulous definition) level. Incidental injury from prongs left too sharp. Injuries from too-tight rings stopping circulation. Strangulation from necklaces that don't fail safely... These days, it doesn't really matter if there's any validity to the claim (or even if you have any involvement with the causing incident); if you can't afford to defend it, you're screwed.

Oh - I forgot one condition that exists with my policy: I'm not to export anything to the US. I'm assuming it's because of the potential for liability cases.
I can probably get it removed, but it'll add to the policy cost.

[enigma]

So have people really been successfully sued for such things?

George, does the GOJD gold membership cover you working in countries outside the UK do you know? Im just a standard member atm.

[pearlescence]

To get around the US thing, make sure your standard terms state that the contract is made under the law of England and Wales, then they can't sue in the US. Such a term stops an American court claiming jurisdiction even with an american plaintiff.
I can't think of any cases of evil jewellery succeeding in the UK courts. The problem is that, if there were actions, the instinct of the insurer is to settle out of court (because it is cheaper than against a claimant who probably has no money to recover your costs) which starts a ball rolling
generally insurance companies these days have become intolerably risk averse.

[LondonJax]

Thank you all so much for the help. We have a local NFU Mizgeorge so I'll pop into them after school drop off tomorrow and I'll have a look at Ageas Peter. I really appreciate the help.

[Petal]

Sorry this is late, but have you tried Ian Wallace. I think he does for insurance for home workers...? Good luck with whatever you decide to do.

[ShinyLauren]

Arrrrgghhhh, I didn't realise working at home invalidated my buildings and contents!!!

I shall be calling Ageas and NFU to see what I can find. Around 25/30% of my sales are to the US, so I suspect this shall be challenging...

[Wallace]

How about if you work out of your garage (not attached to your home). Does anyone know if that makes a difference?

the likelihood of the garage becoming a commercial building may come into play and then, I believe the local authority will also be interested in claiming some potential income!

My home insurance covers me for some of my business, but I cannot have any customers in the house. I also have the guild insurance too.

[TeeDee]

Arrrrgghhhh, I didn't realise working at home invalidated my buildings and contents!!!

I shall be calling Ageas and NFU to see what I can find. Around 25/30% of my sales are to the US, so I suspect this shall be challenging...

Perhaps you could let let us know how you get on. I only sell in the UK at present but have been thinking of expanding to US and others.
There we all were living in blissful ignorance........what a can of worms!
T

[susieq]

Jax/Lauren - how did you get on with the insurance issue? My buildings insurance renewal just popped through the letterbox and as I'm hoping to start selling soon I need to not invalidate my insurance!

I know the local council used to allow you one room in your house as "business use" without incurring business rates so long as you didn't have customers visiting, but I guess that needs to be checked out too. If I put a shed in the garden, I wonder if they could class this as "business premises".

Another option would be to look at hiring bench space - I'm in East London so there's some reasonably close by to me but not cheap at £150 per month.

I had no idea it could all get so complicated - and I thought the learning of new skills was the hard part!

[ShinyLauren]

Where abouts in East London are you Susie? I'm in Walthamstow!

[susieq]

Where abouts in East London are you Susie? I'm in Walthamstow!

Next post code up - South Woodford. On the Central Line. Literally - it's at the bottom of the garden!

[ShinyLauren]

Next post code up - South Woodford. On the Central Line. Literally - it's at the bottom of the garden!

I have a train at the bottom of my garden as well!

I don't know how easy it would be for you to get to, but these guys rent bench space as and when you need it, so might be a bit cheaper?

http://www.madebyore.com/studio-hotbenching/

[ShinyLauren]

Just updating this as am struggling to find someone who will insure me for standard buildings and contents insurance, and to have my studio at home, together with public and product liability.

Has anyone got a policy recently and, if so, with whom?

Am still waiting to hear back from NFU Mutual and have contacted a few brokers on the Ageas website but not had any response.

[ps_bond]

Ageas again this year
https://www.ageas.co.uk/documents/commercial/com066-oct-2013-homeworkers-keyfacts.pdf

[ShinyLauren]

Thanks Peter,

Hopefully a broker will call me back.

Do they cover your buildings and contents insurance on your home, as well as tools and stock? And then will I need a separate policy for public/product liability? I'm getting so very confused!

[ps_bond]

It's an all-in-one, so house & contents are there too. There's a few oddball clauses, e.g. I'm covered to work away from home, but not using heat (?); I'm not covered on product liability for items shipped to the US or Canada and I have employee insurance despite having no employees. 3rd party liability is there as part of it. My tooling caused a lot of consternation amongst other underwriters - clearly when I say "laser welder", they hear "giant laser from Goldfinger".

You should ask a lawyer to cast their eye over it & see what the reaction is... :D

[ShinyLauren]

Thank you!

I think the fact that I sell to the US is going to be a problem.

I suspect this insurance is going to end up costing me more than I earn from jewellery each month!

[ps_bond]

So see if you can get a variation on it?
It's all a scam, but a necessary one unfortunately.

[ShinyLauren]

I wish I could deal with Ageas direct!

I don't think the brokers want to bother with me as my turnover is so low.

I might try NFU Mutual's homeworker policy for buildings and contents then just get a separate one for liability and stock cover - I think it will be easier.

[ShinyLauren]

Got a quote from Aviva via a broker for all in at £1250 per year. Does that sound about right? It's way more than I can afford though :(

[ps_bond]

Sounds somewhat high - getting on for twice what I'm paying. London weighting?

[ShinyLauren]

I thought it sounded a lot. I think I might be better off with separate policies then. My current buildings and contents is £280 per year, so it it somewhat of a hike in price! Also, no option to pay monthly without extortionate interest rates on top.

Will try calling NFU tomorrow to sort home/contents, then try A-N, Ian Wallace etc for the product/public liability and stock cover bit separately.

This has taken up many hours of my time that I should have been spending hitting stuff with hammers!

[ps_bond]

So long as your current insurer is aware & happy that you're insuring the work side separately. LV threw their toys out of the pram when they were told and cancelled the policy on the spot.

[pearlescence]

The scared of America stuff is nonsense, so long as your terms say that contracts are formed in England and Wales that is where the jurisdiction is for any legal action. That comes under jurisdiction or conflict of laws - ie when two different legal systems try to take a case.

[ShinyLauren]

So long as your current insurer is aware & happy that you're insuring the work side separately. LV threw their toys out of the pram when they were told and cancelled the policy on the spot.

My current insurer will not cover for me working from home (I called on an 'if I were to do this thing...' basis) and policy is up for renewal next week so I do need to find both a new buildings/contents policy and then also get PL insurance etc as a separate thing.

[Faith]

Hi Lauren,

I know you'll probably have done this by now - but if it helps anyone else, I think Home Protect might be worth looking at (underwritten by Axa).

I don't sell anything - but it never occurred to me that home insurance would be the reason I couldn't if I wanted to. Out of curiosity I had a bit of a Google - Home Protect do allow business use that's outside the scope of office and admin, and they have "Precious Metals & Gemstones" as one of their stock categories (promising). Looks like they do Public Liability (but not Product Liability), and they do cover 'business equipment' - more checking would be required to see exactly what would be covered in terms of tools.

You have to talk to them by phone (their website will do an estimated quote for a home jeweller but then they say they'll call you to discuss). From the estimated quote thingie they looked pretty reasonable tho.

Faith

[bills makes]

For precious metals I was told I have to have a safe built in to the building , monitored alarm system and security shutters to the windows before they would cover me and domestic policy would be invalid so what do you do to get around this?

[ps_bond]

Find a different insurer? Some insurers seem to get very silly if they hear about anything out of the ordinary - I would swear some think that "working with precious metals" equates to "holding the UK's remaining gold reserves under the bed" rather than keeping a small amount in a safe.

[Faith]

Bizarre isn't it...

I've found that if you use the price comparison sites (I think I used moneysupermarket), say 'Yes' to business use of the property and then 'No' its not just office and admin, what you get is essentially a shortlist of insurers who are at least open to the idea of you running a non-paper-based business at your house that are then worth contacting.

Faith

[bills makes]

Find a different insurer? Some insurers seem to get very silly if they hear about anything out of the ordinary - I would swear some think that "working with precious metals" equates to "holding the UK's remaining gold reserves under the bed" rather than keeping a small amount in a safe. this was from a broker i got commercial business insurance now and craft traders insurance for when out to craft fairs markets etc .