| Well, do you? Ever thought about it at all? You've | | | | The premium is only about $15. and it covers |
| got a Homeowners Insurance Policy. Right? Well, | | | | PREMISES Liability. There, that was easy to take |
| years of experience tell us that most people think | | | | care of, wasn't it! |
| their home business is covered with just their | | | | But read on, it gets worse again. Let's suppose that |
| Homeowners Insurance. And that is fine for your 12 | | | | the gentleman who so innocently stopped by my |
| year old daughters' lemonade stand. But when the | | | | house had gotten hurt using his eBay purchase. He is |
| "hobby" becomes a business, things can change! | | | | an attorney, remember - just my luck! He had bought |
| Sure, you would not be the first one to have a | | | | a collectible from the Worlds Fair in Buffalo, NY, but |
| stolen business computer covered by Homeowners, | | | | let's suppose he had bought a small antique machine |
| but understand this... It is a flip of the coin! If it was | | | | or utensil. The sale intended that it be hung on the |
| taken together with the TV, some jewelry, and | | | | wall and admired. Friends come in and ask, "Hey, |
| other valuables, you may have won. | | | | what the heck is that thing?" |
| Typically, Homeowners Insurance excludes a business | | | | But this guy decides to see if it still works. Not an |
| and all business property and liability. Want the good | | | | unusual or unpredictable event. No one ever thought |
| news first? OK. Many times coverage may be added | | | | to put that in the auction bill, not that it would |
| inexpensively with just a couple endorsements to the | | | | matter. Heck no one even knew it SHOULD have |
| policy, but it wholly depends on the underwriting | | | | had a guard on it! He loses a finger trying it out. Do |
| stance of the insurance company. And the even | | | | you know what an attorney's finger is worth? You |
| better news is that SOME Homeowners Insurance | | | | are about to find out! |
| already include an endorsement for a small amount of | | | | Let's not even imagine his seven year old child is the |
| business personal property, typically $500-$2500. | | | | one injured. She was going to be a brain surgeon. |
| These are intended for the person who takes their | | | | Guess she will have to settle for being an attorney |
| work home with them. If all you wanted was the | | | | now. Would you want a surgeon without all their |
| good news, you can stop here. If you want to | | | | fingers? Wouldn't inspire confidence, would it? No |
| understand the bad, read this: | | | | matter how they really lost it. |
| Let us consider the example of a small home eBay | | | | This is where you are starting to wonder if your |
| business. There are several around these days and | | | | business is really worth it all. You find out that your |
| you probably know of one or may be such a | | | | Homeowners Insurance has an exclusion for |
| business. For this example, assume that you have an | | | | PRODUCT Liability. Yesterday you had never heard |
| inventory of about $10,000. and there is a small fire, | | | | of it and today you are quickly becoming an expert. |
| damaging the inventory. | | | | You actually start reading the forms that came with |
| The insurance adjuster comes out and comments | | | | your policy, the ones that you filed away ten years |
| "Boy, you sure had quite a few fancy widgets!" | | | | ago. |
| To which you respond, "Yeah, we sell them on | | | | Lucky you! They weren't put in the trash like so |
| eBay." | | | | many others have done. You are looking for that |
| Strangely, the adjuster is interested. "Oh really? My | | | | famous loophole, as described in so many movies. |
| wife collects fancy widgets, and we talked about | | | | You think there is the slightest possibility that this has |
| selling a few on eBay ourselves. How is that going?" | | | | never happened to anyone else and the insurance |
| Now you are in business, and one of the first things | | | | companies may have not thought of excluding such |
| you ever heard about advertising was that word of | | | | an event. Silly YOU! |
| mouth was great and free. | | | | The story could go on, but you have suffered |
| In this case you will find, that word of mouth is not | | | | enough. And if you don't get the picture now, you |
| so great and certainly, is not free. | | | | may never anyway. |
| That smell of smoke is not from the fire a couple | | | | Now you wish you had Business Insurance. You tell |
| days ago. Your goose has been caught, slaughtered, | | | | everyone you are in business, don't you? Why, you |
| plucked, basted, skewered, and is turning nicely on | | | | had business cards printed, just last week! Did you go |
| the rotisserie as you speak. | | | | into the print shop and ask for personal cards? |
| Now the really bad news. What we have been talking | | | | Just what sort of insurance should have been |
| about thus far, is the property angle. Do not forget | | | | carried? Go ask your Independent Agent for a |
| you also have your Liability situation to think about. | | | | Business Owners Policy, aka BOP. You can often get |
| While this article cannot get into all the nuances, just | | | | one for small businesses for a minimum premium of |
| understand that Liability is your legal responsibility to | | | | $250. The companies that offer them at that price |
| others for damages to their person or property. | | | | are getting to be fewer in number, but they are still |
| Translated - what you owe someone, because of | | | | available. If you are in New York City, it's going to be |
| something you did, or did not do, that caused them | | | | higher, certainly. But it should not be higher than a |
| injury in some way. | | | | $500 minimum premium, unless your small business |
| For instance, in a Home business related situation, a | | | | has really grown. Have your agent fill in the blanks to |
| gentleman stop by our house to pick up an eBay | | | | best tailor it to your specific situation. |
| purchase he had made from us. Had he slipped on ice | | | | So there you have it ladies and gentlemen. Don't you |
| and fallen, we probably would have been liable for his | | | | wish you had just read the last couple paragraphs |
| injuries. Heck, we WOULD have been - he was an | | | | first? For $250 you can go to sleep and forget about |
| attorney! But his presence, being business related | | | | fires and product liability what-cha-ma-call-it. |
| (picking up a purchase, even if it was "only" eBay), | | | | Oh, did you say that you have an employee (or |
| changes the degree of care owed to him legally. | | | | volunteer labor)? Can't you just hear it now, "Oh boy, |
| It is recommend you endorse your Homeowners | | | | something else I hadn't thought of to loose sleep |
| Insurance for an office exposure, should something | | | | over." Watch for the next in our series for the home |
| of this nature be possible in your business situation. | | | | business. Try to think of these as a natural pep pill. |