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  • Insurance for a hobby shop wanting to sell the odd piece

    I am looking for thoughts and advice on home insurance as it relates to your home shop and being able to sell the odd piece. In my case, I have a basement shop that is insured as part of our home contents. In the past, we were insured through State Farm and I was able to sell the odd piece of woodworking as long as my sales were not my main source of income. When State Farm became Desjardin insurance, that changed and I am told that my insurance won't cover my shop if make any sales.

    For those of you in a similar situation where woodworking is a hobby, but you sell the occasional piece, what are you using for your insurance? I'm sure that I can get a policy just for my shop that will allow me to make some sales, but that seems like overkill when most of the stuff I make is for us or gifts.

    Thanks,
    David
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  • #2

    Re: Insurance for a hobby shop wanting to sell the odd piece

    Won't cover the shop as in loss from fire or theft or liability from a customer getting hurt from something you sold them.

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    • #3

      Re: Insurance for a hobby shop wanting to sell the odd piece

      Check with Ayr farmers Mutual. They are a local company that I have been insured with for many years. They are good people to deal with even when making a claim. We just recently received our rebate. I think we received a rebate 9 out of the last 10 years,
      Bob just past Ayr

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      • #4

        Re: Insurance for a hobby shop wanting to sell the odd piece

        Originally posted by Joed View Post
        Won't cover the shop as in loss from fire or theft or liability from a customer getting hurt from something you sold them.
        Hi Chris - My understanding is that they won't cover the equipment for loss from fire or theft.

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        • #5

          Re: Insurance for a hobby shop wanting to sell the odd piece

          Originally posted by Bob just past Ayr View Post
          Check with Ayr farmers Mutual. They are a local company that I have been insured with for many years. They are good people to deal with even when making a claim. We just recently received our rebate. I think we received a rebate 9 out of the last 10 years,
          Thanks for the suggestion, Bob. I will give them a call.

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          • #6

            Re: Insurance for a hobby shop wanting to sell the odd piece

            Originally posted by DGB_WAT View Post
            I am looking for thoughts and advice on home insurance as it relates to your home shop and being able to sell the odd piece. In my case, I have a basement shop that is insured as part of our home contents. In the past, we were insured through State Farm and I was able to sell the odd piece of woodworking as long as my sales were not my main source of income. When State Farm became Desjardin insurance, that changed and I am told that my insurance won't cover my shop if make any sales.

            For those of you in a similar situation where woodworking is a hobby, but you sell the occasional piece, what are you using for your insurance? I'm sure that I can get a policy just for my shop that will allow me to make some sales, but that seems like overkill when most of the stuff I make is for us or gifts.

            Thanks,
            David
            I really don't know how my insurance would respond. I will check and find out. Thanks for raising this issue; it's an important one.
            The difference between a master and a beginner: The master has failed more times than the beginner has even tried.

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            • #7

              Re: Insurance for a hobby shop wanting to sell the odd piece

              Be careful checking with your insurance, once you ask the question its kept on file and make come back to haunt you. A while back a friend wanted me to help out his small business by occasionally delivering some small packages to the courier. I checked with my car insurance and they said they don't cover delivery vehicles and even if I was delivering as a favour with no payment my insurance would be invalid. If I had never asked they would never know so even if I had an accident while delivering they would not have a reason to ask and therefore I would be covered. I had to decline helping my friend for fear that there is a flag on my file and if I had an accident while delivering I would be without insurance.
              Allegrus likes this.

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              • #8

                Re: Insurance for a hobby shop wanting to sell the odd piece

                I had a similar problem with ”The Personal”. After having them for years, I mentioned my small home business because we were planning to move. They told me that having a home business at all, negated my policy. They were going to cancel my policy immediately, until I agreed to temporarily suspend my business, until we moved and I got a new insurance company.
                We are now with Allstate, which added a small business rider ($120 for the year). I am just not allowed to have clients at the house, or sell outside Canada . I don’t quite understand the last one there.
                Darrin

                Timber Elegance
                My Etsy Store

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                • #9

                  Re: Insurance for a hobby shop wanting to sell the odd piece

                  My business was a bit different .... not woodworking. I retired in 2007 and moved back north in 2010. I was bored so about 2012/2013 I decided to do small engine work part time .... really part time. I had homeowner's insurance on my house and garage, but my insurance company required me to insure my business and garage separately with a premium of about $1000/year so that I could do business to the tune of $12k to $15k per year in "profit". I also bought a diesel tractor and blower to do my lane and make life easier on my sawmill. I thought I'd take on a few lanes each winter to pay for diesel and maintenance and the insurance company required a separate policy for that activity at another $1000/year so that I could clean six or seven lanes in my neighbourhood. My snowblowing revenues were consumed by the premium, leaving me with only the depreciation on my tractor for profit. I did it for about eight years anyway seeing as I had to be out there anyway doing my own. The bottom line? Over the course of six-eight years I gave the insurance company about $12,000 in premiums .... and yes .... I shopped it around. Now I am fully retired and all I have is a couple of rental homes... also paying insurance on them ....

                  If I was going to do hobby woodwork and sell a bit, I'd make it only a "little bit", I'd do it cash, no receipts (report it for tax if you want) and I wouldn't tell my insurance company anything ...
                  Last edited by John Bartley; 03-10-2020, 09:19 AM.
                  woodbizard and smallerstick like this.

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                  • #10

                    Re: Insurance for a hobby shop wanting to sell the odd piece

                    Any question like this should be asked to your insurance company under the guise of being a new, currently uninsured with them potential customer. I also made the mistake of asking my insurance company a question about rates when my wife and I just got married and had separate auto policies with the SAME INSURANCE COMPANY (Geico)!! They said they HAD to add her to my policy even though she had her own policy, WITH THEM! What a mistake I made there it cost me like an extra $50/month until we combined our policies about a year later.

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                    • #11

                      Re: Insurance for a hobby shop wanting to sell the odd piece

                      Originally posted by WoodBob View Post
                      Any question like this should be asked to your insurance company under the guise of being a new, currently uninsured with them potential customer. I also made the mistake of asking my insurance company a question about rates when my wife and I just got married and had separate auto policies with the SAME INSURANCE COMPANY (Geico)!! They said they HAD to add her to my policy even though she had her own policy, WITH THEM! What a mistake I made there it cost me like an extra $50/month until we combined our policies about a year later.
                      This guy must drive you nuts when you see the ads.
                      WoodBob likes this.
                      Learning something new every day.

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                      • #12

                        Re: Insurance for a hobby shop wanting to sell the odd piece

                        Originally posted by darrin1200 View Post
                        I had a similar problem with ”The Personal”. After having them for years, I mentioned my small home business because we were planning to move. They told me that having a home business at all, negated my policy. They were going to cancel my policy immediately, until I agreed to temporarily suspend my business, until we moved and I got a new insurance company.
                        We are now with Allstate, which added a small business rider ($120 for the year). I am just not allowed to have clients at the house, or sell outside Canada . I don’t quite understand the last one there.
                        How do you handle the Etsy sales Darrin? I assume some of those are outside Canada.
                        Jamie www.turneddesignsbyjamie.etsy.com

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                        • #13

                          Re: Insurance for a hobby shop wanting to sell the odd piece

                          jaywood1207 So far I'm just not worrying about it. But I am hoping to set up my own website, to sell my pens, this summer. When I do that I think I will have to bring it to there attention.
                          I am also hoping to figure out how I can take my pens to a couple of the US pen shows. I have to figure how the export thing works.
                          Darrin

                          Timber Elegance
                          My Etsy Store

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                          • #14

                            Re: Insurance for a hobby shop wanting to sell the odd piece

                            I was always told that the minute I use my tools as a hobbyist for remuneration, I'm restricted in any claims should a catastrophe happen on my homeowners insurance to some minimal amount of base coverage of like a few thousand dollars otherwise I am coverered up to my maximum amount of personal belongings coverage on my policy which is in the hundreds of thousands.

                            I actually ask about this to my homeowners insurer every time I go to review my coverage which is typically every year or two. Just to be safe.
                            Kevin

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                            • #15

                              Re: Insurance for a hobby shop wanting to sell the odd piece

                              When I first started setting up a woodworking shop at home I asked my broker if I needed extra insurance and his response was "as long as I don't allow anyone in my shop" I'm covered under my home policy. That was 30 years ago. I've been with the same broker all that time, but due to people retiring, I'm now on my 3rd agent. A few years ago I asked my agent if I should provide an updated list of tools and machinery in my shop and she acted like she didn't know anything about my shop. I explained that Peter knew all about it and so did Howard before him. She claimed there was no mention of it in my file, which was kind of surprising to me. I told her what I had been told way back when and she explained that insurance companies change their rules and fine print all the time and I should read over my policy very carefully. She also said my contents would be covered but if I was running a business, even a hobby business, I had to get an addition to my policy. My shop has been pretty inactive the last 3 years and everything I've built in those 3 years has been for me or my family so I'm not going to worry about it just yet. However, I'm in the process of giving my shop a makeover so that my son and I can get a bit more serious with our guitar making. based on what I've learned from my agent and the stories here I'm going to make sure I have all the bases covered.

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