How do you know you need protection against fire, theft, and customer lawsuits? Insurance for your gift basket business may be a requirement.

Peace of mind

Are you willing to invest in business insurance for peace of mind, or do you prefer taking a chance without it?

Without insurance you’ll hope to dodge lawsuits that not only disrupt business but also terminate ownership of all your family possessions, especially if your business is set up as a sole proprietorship (check your accountant for the facts).

I’ve personally seen the effects of not buying insurance coverage can share this. Leaving the home where you sleep every night, with nothing except the clothes on your back, is a frightening and disorienting experience. The picture you see above is an example. It’s a photo I took of the house next to mine burning out of control. That’s a situation you don’t want to happen, whether you live alone or have a family.

You deserve to profit from making and selling gift baskets. That’s a primary goal when you start. You also deserve to protect yourself and your family from potential liabilities associated with that business. That’s why researching and buying insurance is an important part of your gift basket business planning.

Insurance helps to:

  • Protect your personal assets from loss
  • Provide peace of mind as you build your empire
  • Qualify you to apply for gift basket business projects that require liability insurance

What does an insurance policy include?

First, you must determine what type of insurance to purchase. Then you decide how to structure each part of the coverage.

Thankfully, a reputable insurance agent who specializes in coverage for home-based and retail gift basket businesses will know the standard policy structure and be able to customize it for any special considerations.

My first insurance policy included:

  • $1 million protection against product liability
  • $30,000 for property liability
  • $10,000 for off-site liability coverage

The policy cost $350 per year and was offered by a firm specializing in small business coverage.

My gift basket business at that time was located in my home. As I researched insurance policies, I neglected to contact my homeowner’s insurance carrier to learn if a policy through them would be less costly or provide better coverage.

I later learned that the carrier did not offer rider policies, which is the common name for coverage when a business is set up within the home. A rider insures both home and business.

Insurance policy costs vary between carriers and geographic locations. I’ve heard of costs between $150 and $350 per year. No matter what the cost, coverage is worth your peace of mind.

Where to find an insurance agent

Where do you begin looking for business insurance?

  1. Ask others who operate gift basket businesses who insures their business.
  2. Make inquiries through industry associations.
  3. Check large warehouse stores (Costco, Sam’s Club, etc.) for insurance options. You may qualify for a policy whether or not you’re a member.
  4. Call the carrier that covers your home to learn if they provide business insurance riders.

It’s easier to sleep at night once you find, review, sign, and pay for the policy. However, the task is never completely done. Each year it’s mandatory to review your coverage and decide if you need an update or if the current policy is an adequate choice.

In addition, stay up to date on insurance policy carriers just in case another company offers a better policy. Be ready to change firms if it makes sense without unnecessarily cutting corners.

Need more insurance help? On the audio, Legal Tips to Keep Your Company Out of Court, small business attorney Robin Gronsky explains 25 ways you can stay on the right side of the law. My questions to Robin relate specifically to every gift basket retailer’s needs, and that includes you. This insurance primer audio, valued at $49, is yours after one 15-minute or longer coaching session.

Shirley George Frazier
In the gift basket world, all roads lead to Shirley George Frazier, the industry's reigning expert and international authority. Shirley is chief basketologist at Sweet Survival LLC and author of the industry's best-selling books, How to Start a Home-Based Gift Basket Business, The Gift Basket Design Book, and Marketing Strategies for the Home-Based Business. Shirley works with manufacturers and retailers to successfully add gift baskets to their current revenue streams. Shirley is also a frequent speaker at events and instructor of the popular online course, Start Your Own Gift Basket Business. Contact Shirley to speak at your event or call 973-279-2799 to schedule a consultation.

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