Insurance For Artists

While there may be no way to prevent an emergency from taking a toll on your business, the damage can be minimized with appropriate business insurance. Many artists have considered business insurance but have dismissed it as either an unaffordable or a frivolous expense However, take the following example:

Mr & Mrs Arty lost all of their equipment, materials, tools and inventory in a fire that consumed their studio.
They were unable to work for the three months it took for their studio to be rebuilt. Fortunately, they were covered by insurance.
Mrs Arty said that she was fairly certain their small business could not
have sustained a loss like this without insurance. Their losses totaled over $65,000.

While many feel that insurance can be a world of fine print and technical jargon, it is actually an industry that provides protection for businesses.

Obtaining affordable business insurance that adequately covers your biggest potential risks is a process that takes some time and effort on your part, but the resulting peace of mind is worth it. Business insurance includes a diverse number of coverage components while other types of insurance e.g. car insurance, involve only a few. This means that for adequate cover, each business requires a customised approach to reviewing its insurance needs. It's a smorgasbord as opposed to a vending machine!

Steps in getting coverage

PREPARE A BUSINESS "CV"

To help us understand your business, prepare a one to two page description of your background, experience and the type of artistic work that you do. We can use this information to review your insurance requirements and negotiate the best terms for you.

Types of Business Insurance Coverage

BUSINESS PERSONAL PROPERTY COVERAGE

• Building - Covers the physical structure of your studio.
• Business Personal Property - Covers the contents of your studio such as tools, equipment, raw materials, inventory in progress, finished products, valuable papers and records, and electronic data processing. We appreciate that tools can be expensive to replace
• Business Interruption - Covers the loss of business income incurred during the period of time your studio is closed due to a claim and whilst you get back on your feet.
• Local Marine Sendings - Covers your work while in transit to shows or elsewhere. This can cover your work and equipment.
• Personal Property of Others - Coverage for those who work on other people's property in their own studio.

GENERAL LIABILITY COVERAGE

• Liability insurance protects you if someone is injured while on your property or if your property causes damage to others.

The cost of business insurance is not prohibitive; however, replacing your studio and equipment and not being able to work are. Remind yourself that having good insurance cover is one of the costs of doing business and part of your responsibility to yourself, your business and others who depend on you. The rates for coverage will vary depending on many factors i.e. location, size of business etc.

Things to Watch Out For

• Don't be under-insured. If you can't afford complete coverage, purchasing some insurance is better than having none. However, do avoid unnecessary cover.
• If you rent, remember that the landlord's building is covered under their own policy, but not your equipment, tools and inventory.
• If you have an exhibition at other premises e.g. owned by the local council their liability cover only covers their liability not necessarily yours.
• Home policies provide little (typically $10,000 for home office) or no cover for business related assets. You may be able to add endorsements to your home policy, but for adequate coverage most home based art businesses need a separate business insurance policy.

As an estimate only 30% of artists have business insurance. The cost of not having business insurance or having inadequate insurance can be devastating to any business. We think it is vital that all artists take steps to reduce the chance of loss and acquire adequate business insurance. The cost of business insurance may be less than you think, and when approached with thoroughness and the services of a proactive insurance broker, you will be sure to be getting the most complete and appropriate cover for the money.

This article is intended to provide a general outline of possible insurance requirements and has been supplied by:

Wheeler Financial Services Ltd
Suite 12, Ground Floor
OutSource IT Tower
44 Khyber Pass Road
Auckland
Telephone 09 379 4400

admin@wheelerfinancial.co.nz

Please contact Graham at Wheeler Financial Services Ltd directly to discuss your own personal insurance requirements.