If you are an artist who does not yet have business insurance, you are not alone. Of the 219 artists in the United States who have applied for CERF+’s Emergency Relief grants since 2018, only 67 (or 23.4%) reported that they had business insurance. But, this doesn’t mean you don’t need it.
Laura is a metal artist from New Mexico who is taking the time to learn about business insurance. She works primarily from her home studio, but she travels to sell her artwork at a variety of shows. She asked us some great questions that we thought we’d share with our readers.
Laura: The Insurance Hub section of your website is GREAT! Are there any plans that you especially recommend I purchase or research?
CERF+: Choosing to invest in yourself and your studio practice is one of the wisest decisions you can make. CERF+ has created a list of Business Insurance Plans for Artists. While this is not an exhaustive list, it’s a great place to start. A number of art organizations and associations, such as the American Association of Woodturners (AAW) and American Craft Council (ACC) sponsor business insurance plans as a service to their members. This list also includes insurance companies that are used to working with artists and have an understanding of their insurance needs and risk exposures. Did you know that you might be able to find a business insurance policy catered to your needs as a studio artist for as little as $300 a year?
Laura: Are there other artists you know who have gone through this experience of needing insurance whose studio practice might be relevant?
CERF+: Several years ago, Christina and Michael Adcock, a basket weaver and potter, respectively, lost all of their equipment, materials, tools and inventory in a fire that destroyed their California-based studio. They were unable to work for three months while their studio was being rebuilt. Fortunately, they were covered by business insurance. “As craftspeople, we tend to have limited financial resources. Without insurance,” Christina notes,“ I am fairly certain our small business could not have sustained a loss like this. I looked up our business insurance expenditures prior to the fire and was surprised to see that we had spent a little over $300 for the insurance that saved our business.” Their losses totaled over $65,000.
Laura, we sincerely hope you never experience a loss like the Adcocks’. While a studio fire is relatively uncommon, it’s one of a number of setbacks that could seriously affect a working artist. If a tree falls on your studio, your booth display falls on a child, a visitor trips in your studio, or any other significant setbacks occur, you will protect yourself and your art practice if you are properly insured.
Laura: Can you help me understand the difference between liability insurance and business property insurance?
CERF+: Great question, Laura!
Liability Insurance covers you when unforeseen things happen that result in bodily injury or property damage to others. What if your art show booth gets blown or knocked over, destroying $50,000 worth of blown glass in your neighbor’s booth, or worse, injures a child? Liability insurance follows you wherever you go, so you would have coverage at a show if something happens to someone else when they visit your booth.
Business Property Insurance (aka Business Personal Property or BPP) covers your work and other property in your studio. To cover your work at a festival or at a location other than your studio, you need an endorsement (rider) that covers property while you are away, often referred to as “inland marine.” Some, but not all, of the low-cost plans that combine liability and property coverage for artists automatically cover your work while you’re away from your studio, but it is always important to ask how much coverage you have or to specify how much coverage you need.
You can find an affordable comprehensive insurance policy that covers both liability and business property coverage. Known as Business Owners Plans (BOP), they are often more economical than buying standalone coverage. It’s also important to remember that homeowners or renters insurance usually excludes most business property and all liability related to business activities, unless you have specifically purchased a home business endorsement (rider). Visit CERF+’s Insurance Hub to learn more about finding the best policy for you and get your free Business Insurance Guide here. CERF+ also has some information about how to take an inventory of your studio, which is great to have when determining how much coverage you need and is also extremely handy if you need to file a claim.
We know that looking into insurance can feel daunting at first, but if you commit learning about it, we are confident that you’ll agree that having business insurance makes a lot of sense!