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Hey folks. I hope everyone is doing well!

I have had business insurance with Heritage for several years and all in all I am pleased with them. But then again, to date, I have not had to submit a claim. It is now time to renew, and my premium will be higher, mostly because I have more that needs to be insured.

As a result I've decided to look around at least a little bit before locking myself in for another year. My shop is in my home and I have discussed this with my homeowners insurance provider. They have suggested I stay with a business insurance company for most items in the policy.

Anybody got any suggestions of a competitive estimate?

Hi Gerald, wish I could help but I have not heard of any other company offering similar coverage. I just sent in my check for another year to Heritage so I guess I am locked in for now. I have not had to use mine yet either but I do know several builders who have and with no trouble that I have heard about. Take care and keep us informed of you find something.

My shop is also in my home and my insurance guy told me the same. Get additional business Insurance.

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Lance@LuthiersForum.com

Ditto on what Lance and John said.

An independent broker should be able to get you a couple of quotes.

I'm not looking forward to next year's rate hike. With the market heading down, the insurance companies are going to have to adjust their rates, probably a considerable amount.

Yea as an insurance investigator for years after cop retirement. I dealt with issues like this often.

A homeowner policy may or may not pay on a claim. Most have little things in the fine print that can cause a denial of claim pretty quick.

My daughter is an adjuster and we were talking about this in relation to my shop. If a hobby, they would probably pay, after a guy like me investigates to make sure only a hobby and then at a pretty low rate for depreciation. If I found or they determine a business, then gets sticky as they don't look at it as your home. It is kind of like IRS and getting deduction for home office or shop and having dedicated area, if that makes sense. I know policy premiums can be high, but if get a loss with theft, breakage of items for customers, or damage to structure, could be worth it.

Heritage is a good outfit, and if have relationship with them, can be better to stick with what you know. Good agents will be up front with you and not try to just get the policy, sounds like you folks all have good honest agents. Also if do a business out of home and homeowners find it, they can really jack up the premium on those things to, and more than business policy. They can cancel you on a claim relative easy also if want to. Made great living on the insurance investigations and have friends in the business, but hate them. If they can find any reason for a denial, believe me, they will.

Insurance coverage can vary greatly from one compant to another. Know what you need to cover. My coverage is up to cover loss of customers guitars. I also have loss of income from illness and injury added to the policy. Get yourself an agent that you feel you can trust. Know what you need to cover and tell him/her.
As an agent they will also give you some help as to what to cover. If you are doing repairs and you happen to get a pre war D45, will it be covered if the cat jumps up on the bench and knocks it down? These are the kinds of open ends you need to tie up.
good luck
john hall
Blues Creek Guitars

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John Hall
blues creek guitars
Authorized CF Martin Repair
Co President of ASIA
You Don't know what you don't know until you know it

Thanks for the replies folks. I think this is an important topic for a forum like this, as important as any for businesses and individual musicians alike. When I first bought business insurance a few years ago I didn't know what to ask nor how to receive the vague answers. Here are two examples I ran into with two different companies just yesterday where further questioning for quantified answer was important:

1." Your instruments are covered for full value". Sounds good, but their definition of "full value" and yours may be different. Be sure you know their definition - press them to be clear about it.

2. "Your shop is protected from water leak flooding". Sounds good, but it is like many political ads in that it may be a half truth - and a half truth is basically a lie. Ask about the above ground clause and what their definition of "above ground" means. If your shop is in your basement, or if you store your guitars in a basement den, you may not be covered, even if your house is on a slope and only half of it has dirt outside the walls, and even if your basement has drains to prevent it from flooding.

As mentioned in a post above, all companies have slightly different rules. Some companies only insure one item per occurrence on transit insurance. For example. If you ship three guitars to a show and the plane crashes and they burn. Only one is covered. I confirmed this today. So either you buy a rider for the show or you ship them on different days. The company is up front about these things but you have to know to ask or you may find out too late.

Some companies will only pay a builder the wholesale value of their instruments if they get destroyed. Their assumption is that if you can't sell an instrument, you may "manufacture" a destructive calamity then file a claim. That comment left a bad taste in my mouth - kind of like telling me that they will punish all businesses because of a few dishonest one's, and oh by the way, I might be one of the dishonest ones. On the other hand, the company was up-front about it ahead of time.

All the information I've shared here is the result of direct contact with providers and not hear-say. To me, it's very important to be covered for the reasons mentioned by the other posts above. You home-owners insurance will not cover you business losses.

And please don't get me wrong - I'm not bashing anyone here - I think the companies will pretty much come through as long as they have competition and as long as we know what to ask up front. These folks are suppliers (vendors), just our other suppliers. I've found that established relationships with suppliers bring value that goes far beyond the price tag. Those relationships may be friendly and cooperative, but accountability and respect should be expected from both sides. For me, spending time asking questions and discussing the answers goes a long way toward developing rapport and respect on both sides.

So far I've found three companies. They are Heritage, Anderson, and Clarion. I think I've pretty much made my decision but in the interest of further valuable discussion does anyone know of any more or have more comments?