Do you make more than $5000/yr? Second heads up

[Guest guest]

I wrote about this last month, and nobody seemed to notice the dangers

to your business if this insurance change comes into effect. Please

follow the link to learn more.

---

from Donna Maria Coles, of HBN:

 

With tremendous growth comes tremendous change. What better time to

take stock of that than the first week of a New Year? Of course the

handmade beauty industry has undergone huge growth over the past five

years. HBN started in 2000 with no members. By the middle of the year,

there were 46. Two years later, there were 200 and today, there are

over 450 members in 7 countries.

 

While many HBN members operate their businesses outside of their

homes, many others work and manufacture products at home. Indeed the

number of home-based businesses in all sectors of the economy is

increasing and micro-formulators of cosmetics is no different. With

the growth of the home-based micro-formulator comes the increase in

the number of consumers who are able to benefit from the unique

benefits of handmade beauty products. And you know what that means of

course -- increased liability exposure, at least in the minds of the

bean counters at the nation's insurance companies.

 

As a result of our industry's success, RLI Corp., one of the only

companies that provides comprehensive products liability insurance

nationwide, announced a decision to discontinue providing products

liability coverage for businesses that gross over $5,000 in sales per

year. That means that people will have to choose between stagnation at

the $5,000 level or growth and success without products liability

coverage. For some it may even mean closing their doors since a

growing number of retail outlets across all sectors of the economy

will not buy products unless the manufacturer can produce a

certificate of insurance.

 

What does this mean for HBN? Well, judging from the number of

responses I got from an announcement sent to the membership on

December 21, 2005, it means that a priority for HBN this year is to

seek out alternatives and ensure that our members voices are heard on

this issue.

 

To that end, I have assembled the Home-Based Personal Care Business

Task Force (see Announcement), consisting of the following

organizations which accepted the invitation to join the Task Force as

leaders:

 

The Handcrafted Soap Makers' Guild (Marie Gale, President)

The National Association for Holistic Aromatherapy (Michele Miller,

President) The Natural Perfumer's Group. (Anya McCoy)

 

Dozens of HBN members have also joined the Task Force so that

collectively, we can make sure that RLI and others understand fully

the consequences of their actions. Stay tuned over the next several

weeks for updates. If you have been affected by RLI's decision and

wish to serve on the Task Force, see instructions for joining in the

Announcement.

 

I have also updated HBN's website Task Force Page with an announcement

about your agreement to participate. See

http://www.handmadebeauty.com/taskforce/index.asp.

 

http://naturalperfumery.com

The premier site on the Web to discover the beauty of Natural Perfume

 

Join to study natural perfumery

[Guest guest]

Hi Anya!

 

Wow, haven't seen you in awhile. Though I am not around too much these

days. I have heard about this change, and everybody is talking about

it on the forums and groups.

 

We are covered, we just moved into a new warehouse space. From what I

gather, coverage is based on whether you actually make product like

soap and candles/ manufacture them.

 

Since we don't make our soaps and candles we are fine for coverage and

pay under 600.00 a year.

 

I hope that folks will be able to come up with an alternate and

reliable solution.

 

Thanks for sharing this again, it has definately been on my mind the

last few weeks.

 

____________________

Blessings!

Rachel - Founder

http://www.scentbyspirit.com

Brew our Tea, Taste the Magic

email us for a $10.00 Coupon

, " rastapoodle " <mccoy@n...>

wrote:

>

> I wrote about this last month, and nobody seemed to notice the

dangers

> to your business if this insurance change comes into effect. Please

> follow the link to learn more.

[Guest guest]

I didn't respond on this list but since I am still in the process of finding

product liability insurance, I did respond to Donna Maria's article and I

suspect a handful of others did as well.

 

BTW, This change is *already* in effect with RLI. I called them for a quote

last week or so and they will not cover anyone with *revenue* (not profit --

revenue) over $5,000/year. Their reasoning is that if you are moving that

much product then you are no longer a " hobbiest " and that you need a whole

new level of protection that they do not provide. On a side note, they also

won't cover my herbal infusions/tea even if I only make $0.25/year, so I am

SOL with them anyway unless I want to discontinue that line, which I don't.

 

I also know of other handmade manufacturer's on the list who need more than

$1mm coverage, which RLI doesn't provide. I also do web development and

some software development and the RLI rep suggested to me that I maintain

separate business names for my tech stuff vs. body care, which further

irritated me. I am Snowboard Mommy Productions, dammit, and when I'm not

snowboarding, I don't feel like having to come up with 20 other names to

cover all the dorky, herby things I do until I get back onto the snow again.

 

I actually requested that Donna Maria expand her task force to make sure

that we can get the coverage we need for all the things we do as " work at

home parents " ... I don't know if she's going to ... she may just focus on

the handmade beauty issues, but I thought it was worth mentioning it to her

since she is now promoting the " Lifestyle CEO " resources and since her goal

is to get insurance companies to provide a business insurance product

something that meets the needs of today's home business entrepreneur. Heck,

I have enough of a work backlog that think I need something for *tomorrow's*

home business entrepreneur!!!

 

Anyway, thought I'd let you know that it didn't fall on deaf ears ... just

busy hands that only had time for taking action and not writing about it

till now.

 

~Bonnie

 

PS: If anyone else sells herbs/teas and has product liability insurance for

tea or any other " internal " product I would love a referal. Thanks.