Hello fellow soap makers, I have been considering soap making insurance and wondered how many others actually get the insurance. I have never used the polling option before so I hope this turns out right. Thank you to those who participate!
How many soap makers get insurance?
- Thread starter Satinfox
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i don't know the laws of your country but here is a link you might find useful: Business insurance
I don't sell, so I don't have insurance. If I were selling, I would absolutely. I think you might want to revise your question to reflect what you really want to know - which I would guess is selling with or without insurance.
Unless you can afford to lose your house and life savings by possibly being sued then it’s absolutely necessary. Plus many venues require it to participate.
Thank you for the link. I am in the United States.
I wouldn't mind knowing if a person who gives soap away purchases insurance too. It does seem unlikely that someone would purchase insurance if they were not selling soap; but, you never know.
I would like to get a picture of the number of soap makers that purchase insurance. This poll isn't going to reach soap makers who don't read this thread so it wont be very accurate. But it an interesting question. We don't have statistics on soap making. I researched how many lye accidents occurred each year and found very little information regarding soap makers.
To be clear, are you referring to business insurance? Or to health insurance?
If business insurance, I don't sell, so my answer would be no. However, I do buy health insurance through my work, and I probably wouldn't risk working with caustic chemicals if needing medical attention had a good chance of wiping out my savings.
If it's health insurance, everyone with universal healthcare doesn't have to worry about that, and that would change the numbers a bit as well.
The Cat Lady
Active Member
In the UK and I've got insurance here - public liability and product liability. I also have cosmetic safety reports for the few soaps I sell. It's quite a costly process so only have limited ones I can sell eg. six variants. I wish I could make loads of different scents and types to sell but it's in my nature to be safe and err on the side of caution (ex health professional here) It annoys me when I see people selling all sorts of soaps without any cosmetic safety reports or insurance here in the UK - but it's their risk they have chosen to take. I'd rather be legal and safe here.
Thanks. I was referring to soap making insurance.
Thanks. It would be nice to know how many soap makers have insurance world wide...and how many soap makers there are world wide.
Angie Gail
Well-Known Member
I do sell and I've tried multiple places to get insurance as some craft shows do require it and I haven't found one that will give me a policy. They've all said I don't make enough money yet (we've been online for a few years and just started craft shows at the end of last year). Anybody have a good recommendation where I might be able to get a policy?
jcandleattic
Well-Known Member
If you sell, insurance should be a MUST. You never know who is going to have an allergic reaction to one of your ingredients, and let's face it, the US is a litigious country and people sue at the drop of a hat. You want to be covered. It's a business expense, and there's really no reason not to have it. If someone can't afford insurance, IMO they can't afford to be in business.
sarahmarah
Well-Known Member
I don’t have insurance because I’m not selling but if/when I ever do decide to sell I will definitely be getting insurance. We live in a litigious society and the most responsible decision for me is to protect my assets.
You can get it through HSCG, indie business network, handmade insurance. I actually have mine through State farm.
Angie Gail
Well-Known Member
Thanks; I'll try some of these!
Ooh, I have state farm for other things, I wonder if I could bundle.
jcandleattic
Well-Known Member
I originally had mine from State Farm, but I finally decided to go elsewhere because they wanted $800 a year, and I could get it cheaper through HSCG and HSCG will also cover my candlemaking. (Not all handmade insurance's would - State Farm did but it ended up being too expensive)
A lot of people think that the first thing they need to protect themselves is an LLC. As an attorney, I can assure you that is not correct. An LLC may protect you from having to pay a final judgment out of your personal assets, but even that is not a given if you don't strictly follow all the rules about keeping your business and personal assets separated (different bank accounts, no commingling of funds or supplies, etc.).
More importantly, an LLC does nothing to help you pay for the lawyer needed to defend yourself against any lawsuit that is filed. Believe me, the lawyer bills will bankrupt you just like any court judgment, and often much sooner in the process. In contrast, good insurance will pay for the cost of a lawyer to defend you, so you are not out of pocket during the course of the lawsuit. And good insurance will also pay the cost of the judgment, thereby protecting your personal assets up to the policy limits.
Another issue with LLCs is that some states have minimum taxes for an LLC. For instance, an LLC in California must pay a minimum annual tax of $800, even if the LLC doesn't generate one dime of income. That's more than some people make from their soap business. Most other states don't charge as much, but in many of them, opening an LLC will generate ongoing costs that far exceed the small cost of establishing it.
For all of those reasons, I try hard to educate people that the FIRST thing to spend on in your soap business is insurance, along with a paid consultation with your tax advisor or legal advisor to ensure that you are following all the local, state, and federal business laws and regulations, including collection and remittance of sales tax, filing of sales tax returns, etc. Your personal financial picture is not like anyone else's, especially if you don't live in the same place as another soaper who wants to give you advice about this. If you are seriously considering selling soap or other body care products, or anything for that matter, you will save yourself a lot of grief by paying for a consultation to ensure that you are doing things properly. That may not have been true in years past, but I can assure you, it is true now.
More importantly, an LLC does nothing to help you pay for the lawyer needed to defend yourself against any lawsuit that is filed. Believe me, the lawyer bills will bankrupt you just like any court judgment, and often much sooner in the process. In contrast, good insurance will pay for the cost of a lawyer to defend you, so you are not out of pocket during the course of the lawsuit. And good insurance will also pay the cost of the judgment, thereby protecting your personal assets up to the policy limits.
Another issue with LLCs is that some states have minimum taxes for an LLC. For instance, an LLC in California must pay a minimum annual tax of $800, even if the LLC doesn't generate one dime of income. That's more than some people make from their soap business. Most other states don't charge as much, but in many of them, opening an LLC will generate ongoing costs that far exceed the small cost of establishing it.
For all of those reasons, I try hard to educate people that the FIRST thing to spend on in your soap business is insurance, along with a paid consultation with your tax advisor or legal advisor to ensure that you are following all the local, state, and federal business laws and regulations, including collection and remittance of sales tax, filing of sales tax returns, etc. Your personal financial picture is not like anyone else's, especially if you don't live in the same place as another soaper who wants to give you advice about this. If you are seriously considering selling soap or other body care products, or anything for that matter, you will save yourself a lot of grief by paying for a consultation to ensure that you are doing things properly. That may not have been true in years past, but I can assure you, it is true now.
HSCG is pretty expensive, because you need the HSCG membership to buy the insurance. Compared to my policy, it's only like $100 diff
I'm planning on switching to HSCG this year. It's actually more expensive than my SF policy (like $100) but I think the coverage is better and the language is better defined as it's tailored to our industry.
jcandleattic
Well-Known Member
But I get so much out of my membership with HSCG that it's worth it. I originally had just the membership without the insurance because I had insurance through State Farm, but once the insurance got up so high, it was actually more than a $500 annual difference for me.
I think if I hadn't had my membership with HSCG, OR I didn't actually use my membership with HSCG then yeah, it wouldn't be worth it. But the insurance through HSCG is relatively inexpensive when only comparing insurance costs.
Angie Gail
Well-Known Member
I just joined HSCG and got the insurance I needed. Thanks so much for this info! This will increase the number of craft shows we can participate in as well as having coverage now.
