Knifemaking/Bladesmithing and Insurance.

[Rick Marchand]

Can any of the makers here share how you have approached insurance issues with bladesmithing? (Attached or separate shop) I know a few horror stories of folks getting denied household insurance and mortgages because of their choice in profession/hobby.

I don't see it as much more different than having a welding shop, pottery/glass-blowing studio or auto garage. My main concern is to separate it from the house.

What scares me is I KNOW people who have had major problems getting insurance, even with a separate shop building. A friend was almost denied insurance and a mortage because of a shop that's in a building 100yards from his home! I have been looking to relocate with my family and have had issues with town planners and insurance brokers when I refer to myself as a "Bladesmith"... ... then, how do blacksmiths and farriers stay in business? I am really confused and I'm starting to confuse other people. Interestingly enough, when I changed my title to "Artisan Craft Worker"(totally made up) they were very receptive... especially the town planners.

Rick

 

[parbajtor]

I went through similar problems over here in UK.
Finally solved by joining AIR (Artists Interaction & Representation)
http://www.a-n.co.uk/air/topic/469396 (pretty sure this isn't deal spotting, but delete if it is)

 

[Rick Marchand]

I went through similar problems over here in UK.
Finally solved by joining AIR (Artists Interaction & Representation)
http://www.a-n.co.uk/air/topic/469396 (pretty sure this isn't deal spotting, but delete if it is)

That's not deal spotting. I asked how makers are addressing an important issue and you responded. Thank you. I'm sure there are organizations like this in N. America. The ABS and CKG should be able to help, too.

There are many makers on this forum who work and teach bladesmithing for a living and I hope to hear from them, as well.

 

[defaultuser]

Subscribed. Very interesting question!

 

[james terrio]

Interestingly enough, when I changed my title to "Artisan Craft Worker"(totally made up) they were very receptive... especially the town planners.

I think you nailed it; you get different reactions depending how you word things. To many ears, "knifemaker" or "bladesmith" conjures up visions of some weird, probably violent psychopath, whereas "craftsman" or "artisan" (which you indeed are) reminds them of the friendly fellow who sells organic honey or handmade quilts at the farmers' market.

We will be moving this summer as well, so naturally I'm asking the same questions you are. As it happens, the zoning ordinances in the city we'll be moving to (Knoxville) specifically list "craftsperson" as a legitimate, legal, easy-to-get-a-permit-for home-based business. I'm guessing/hoping that will help with the insurance issues.

The fact that you are a hammer jockey, slinging nearly-molten metal and vast showers of sparks around*, may pose additional problems... even a woodstove, welder or kiln can raise serious and expensive eyebrows with insurance folks, let alone an open forge. My plan is to get with the fire marshal and ask all his/her recommendations for safety, before approaching an insurance agent. Again, I'm hoping that due diligence in terms of handy fire extinguishers, clear exits, fire-resistant stuff on the walls etc. will help show the money people that I'm a professional, not some lunatic who's going to burn down the neighborhood.

Membership in trade/professional organizations couldn't hurt either.

*see what I did there? We all know that's a big silly exaggeration, but a non-knife person/bureaucrat might go "good gravy, LOOK OUT, this guy's obviously nuts!" upon hearing that you forge steel.

 

[sunshadow]

I have business insurance through a different company than the homeowners insurance. I am in a slightly different category since my main business is jewelry design and fabrication and the knife/fencing sword business is a (listed) sideline. Homeowner's insurance is a weird thing, they look for every possible means to raise your rate/deny you. Business insurance brokers are a completely different animal. I did a quick google search for business insurance agents, found out there was a broker a mile from my house and got a policy through a local guy

-page

 

[james terrio]

That makes sense, Page. :thumbup: This is a whole 'nother ball of wax, but declaring your business as a seperate entity may turn out to be pretty important, too, for both insurance and tax reasons. I'm just beginning to look into whether it's best for me to file as a DBA, LLC, sole-proprietor, etc. The local Chamber of Commerce, small-business groups, etc may be able to help. I dread to say it, but it might even be wise to consult a *gasp* attorney!

 

[Patrice Lemée]

My shop is the garage, attached to the house. I do this as a hobby. I am calling the broker this afternoon and will post results here. Wish me luck.

What I would be afraid of with playing with wording to "disguise" knifemaking is that they could still deny a claim whit what they found in the rubbles if the house burned down for example.

 

[Dave Behrens]

Rick. I know you want info on Canada's insurance "laws", but I can't imagine it is to much different from here(could be dead wrong). The place were I got into knifemaking and learned the basics, was on 50+ acres of farmland with several outbuildings. The shop area measured maybe 15'x15', and was about 300+ feet from the main living area. The owner was told by his insurance Co., the shop building could void the insurance policy for all the buildings, including the home 300+ feet away(I don't remember how or why). He had to lock it up, and only he was permitted to enter and use that building. Hope this might help.

Just thought of something else. Home Insurers get fidgety anytime something that can cause fire is mentioned. So words like FORGE, HT OVEN, TORCH, SPARK, GRINDER, or of the sort will probably make insuring your shop more difficult, and impossible for your home if your shop is "attached". The only way I see around this is, having a slabbed(concreted) outbuilding, built the accepted distance from your home, built to all electrical, fire, building, plumbing, and business codes. Have it properly assessed and inspected, and insure the building and equipment seperately. If knifemaking is not your full-time profession, nor a source of income, therefore technically a hobby, I don't think your would be able to have your shop/home insured attached or not.

 

[james terrio]

What I would be afraid of with playing with wording to "disguise" knifemaking is that they could still deny a claim whit what they found in the rubbles if the house burned down for example.

You're right, it's a slippery subject and there's no sense in dishonesty. I wouldn't advise anyone to disguise what they do, but I've found that the opening approach often makes a big difference. For instance, when people ask me what I make, I start by mentioning heirloom-quality hunting, camping and kitchen knives (which is true)... I don't start by talking about the combat/fighting knives I make (which is also true, but turns some people off).

My point is to be straightforward from the outset, and prove that you're being responsible. But subtlety can help get the legal/money folks on your side to start with.

 

[Dave Behrens]

DO NOT DISGUISE, OR LIE TO INSURANCE COMPANIES!!! IF THE WORST HAPPENS, THEY CAN(AND OFTEN DO) INVESTIGATE, AND YOU COULD BE S.O.L.

Tell them the whole truth. "I design and build high-end, custom cutlery," is usually what I tell everyone, if they inquire further I tell them professional kitchen, hunting, and utility knives. That is the truth, if they do not wish to insure me or my home that is their right a private company, another company will insure me. Your rate may be higher which is also the insurance Co's right, it is part of running an out-of-home business let alone a hazardous one.

 

[cbr900son]

I do knwo that if you have a open walled work area in say your backyard its not the same as having a actual shop. Its like a fire started froma bbq pit on a covered porch vs a bbq pit in your garage (which just seems weird)

 

[Rick Marchand]

Yes... nobody should be dishonest but semantics goes a looooooong way in properly communicating your case. For instance, at the town my wife and I were looking to move to, I was looking to set up shop on the main strip to get foot traffic. Mahone Bay is an artsy tourist town and I have ideas to expand my business and take advantage of that. I met with the planner and gave a full business proposal. It was rejected. I was shocked and asked for a reason. It was like pulling teeth but they finally told me that neighbors would complain of the constant banging, the smell of the horses and felt there wasn't sufficient room for stabling my "clientele". I asked if the even read my proposal and they said it was no use because they didn't feel a "blacksmith" would fit in with the town's direction. They suggested I buy a farm in the country............... ......... Blacksmith?... I AM A BLADESMITH!...... No horses, no stalls, no constant pounding... no poop!..... READ THE BUSINESS PLAN!!!!!. Two days later, they called back with great news. "We would love to have you in our community." Then sent me a package with info on government/local artisan grants and a list of just about every business/organization in Nova Scotia that I had something in common with. They have kept in touch and offered assitance in locating realestate that suits our needs. A total 180deg change of heart all because of ONE WORD!

We are still trying to deal with insurance, hence the thread.

 

[Kevin Casey]

Rick- I went for a long time without insurance on my building and equipment and every time a dark cloud went over the place I was uptight about lightning, a fire, or a tornado :barf:..... I now have insurance and sleep a whole lot better . Insurance underwriters will vary from state to state and even county to county. Once you start to sell your product you are not covered by homeowners if your building is not attached to your home- you're a business whether you are incorporated or not from an insurance standpoint . If it is attached, your homeowners will cover it but your premiums will go up as a result. A separate building will require a separate business policy. Try your local agent for starters. If they can't or won't help :jerkit:, look to trade groups such as Artist Blacksmiths of North America, and other art and craft organizations. Also consider calling your place of business not a"shop", as that often means to insurance people light industrial stuff, but something like a "studio" which is more of an artsy approach and covers a lot territory in what you are doing . Expect to have at least one inspection if you can get coverage. And also consider calling yourself a metal sculptor or artist not a bladesmith . After all, knives are works of art ....they just happen to be sharp and pointy . Lot's more about this subject for sure and you if need more info give me a call. And good luck with it!

 

[james terrio]

Rick and Kevin get what I was trying to say. I was not suggesting lying, I think that would be insurance fraud!

 

[NickWheeler]

Actually that would be a farrier Rick Sorry, I just liked the irony.

I agree with Kevin. I'm still trying to find a good business insurance policy for the shop.

No matter what you do, the insurance company is going to try to screw you. My parents had a policy that should cover their house and everything in it about 3 times over... Yet now that they're actually trying to make use of the insurance, following their Christmas day fire... the insurance people are trying to nickel and dime them on EVERYTHING. All the way down to crap like receptacle covers.

My gut feeling is that no matter how great a policy you find, if you actually have a tragedy like a fire, an adjuster is going to see a propane tank, welder, etc. and tell you your policy doesn't cover it. :grumpy:

 

[Gossman Knives]

Rick, I rent a shop that is 9 miles from my house. The property I operate my business in is zoned industrial/commercial. I had no problem getting insurance. I got a recommnedation for a local insurance agent from my State Farm agent. I've been there since 2007 and have had insurance the whole time.
I wanted to add that the insurance company knows exactly what I do and all the equipment I use in the building.
Scott

 

[unky_gumbi]

Rick, when you find your insurance company, get everything the broker tells you in writing, then take that and compare it with the actual policy. I had to do that with my bikes in Winnipeg, the broker told me that my bikes were covered for full replacement value, even after I showed them the receipts and replacement estimates. When I got the actual policy and I read it over, the replacement coverage on my bikes was only $500 of all three. I got on the phone right away and told them what I had been told by the broker and if they didn't match that I would have to find another company, then faxed them what I had got in writing from the broker along with the same documents I had shown the broker. Two days later I got a call back from the insurance company and was told they were sending me an updated policy that reflected the actual replacement cost of my bikes, with the same deductible and only $2 more a month. When I got the new policy the only things changed were the month payment and the replacement value coverage max limit was removed.

 

[Patrice Lemée]

Well as expected, when I said I made knives, the lady at the insurance office reacted like I had just told her I knitted underwear from nose hairs of albino pygmy baboons! She asked me 3 times if I had a commercial sign after I told her it was a hobby I did in my garage in a residential neighborhood. She will get back to me.

 

[tattooedfreak]

Rick, contact the Nova Scotia center for craft and Design, they might be able to give you some names or at least an idea of where to go. http://www.craft-design.ns.ca/ If they can't help or if you want more info, the Maritime Blacksmiths Association should definitely be able to help. Yes, I know, not a blacksmith however, you still deal with flames and hot metal. Im sure they get insured somehow. http://maritimeblacksmiths.ca/clinker/