4 Levels of Business Insurance for Artists (Podcast)

Business insurance!

That’s our topic for this Art Biz Podcast. Stay with me because this is important.

Claudia McClain, founder of HomeBusinessInsurance.com, addresses the various levels of an artist’s career and the kinds of insurance you need at each point. I loved the way she broke this down – explaining very clearly what type of insurance you need at each level.

You never think about business insurance until someone asks to see your certificate of insurance or, more likely, until it’s too late. Until something bad has happened.

If you are an artist selling your art and you don’t have a specific policy for your business, this episode is for you. Refrain from clicking the Play button at your peril …

 

Level 1: Homeowners Insurance Only

This is the earliest phase in an artist’s career and is for hobbyists only. You’re making art just for yourself, not to sell.

At the point when you start selling, you are considered a business by the IRS and must take additional steps to protect your business.

Level 2: Incidental Business Occupancy Endorsement

This is a very affordable option for your home studio, which is tacked onto your homeowners policy.

It doesn’t cover the instances when you take your art outside of your home, and it might not cover liability when you have visitors to your home studio. That’s when you need …

©Karen Lockert, Awakening. Embroidery thread, beads, acrylic on canvas, 12 x 12 inches. Used with permission.

©Karen Lockert, Awakening. Embroidery thread, beads, acrylic on canvas, 12 x 12 inches. Used with permission.

Level 3: Home-Based Business Policy

In this step, your home is still your base of operation, but you are taking your art to festivals or exhibitions outside of the home. These venues are likely to ask for a certificate of insurance. However, even if they don’t, you still want to protect yourself.

If you usually purchase insurance for a single event, it’s probably more cost-effective to insure your business for the whole year.

Level 4: Commercial Insurance

When you get to the point where you are earning significant revenue and/or you have a studio outside of the home, you need to look into commercial insurance.Photo of Claudia McClain

Mentioned + Resources

Get a quote for what insurance might cost for your art business. (Rates based on Western U.S.)

CERF+ Studio Protector

About My Guest

Claudia McClain is founder of HomeBusinessInsurance.com, which, serendipitously, she started in her own home in 1977. Claudia came to my attention through a mutual artist-client (thanks, Cynthia Lait!) and clearly has a passion for helping artists make sure their businesses are protected.

Yellow Graphic Line

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16 comments to 4 Levels of Business Insurance for Artists (Podcast)

  • Thank you for a very informative resource. I added this link and others to my Evernote file.

  • Alyson,
    Thank you so much for this podcast. It was quite timely since I just asked about insurance for artwork on the Accelerator Facebook page this week. I am going to email my insurance agent about a home based business policy when I finish this comment.

  • THANK YOU! I have insurance on my studio outside the home, but now realize that I need a home based insurance policy as well because I also have a studio at home, and have a home studio tour at least once a year. The majority of my art and supplies are at my home. Sounds like a home based business policy will also cover my art in personal transit to shows and in shows. Just what I need. I live in Colorado, so will look into Claudia’s company online: homebusinessinsurance.com .
    This was so informative. Great topic, Alyson!

  • Sheila Parsons

    I li hi I live in Arkansas and I have my studio my home and a gallery in my home is listening I am wondering what kind of insurance I need for that I’m very rarely have people come to my home gallery to buy anything but it does happen from time to time

    • Sheila: You sound like Level 2, but you’d have to ask about the liability. An insurance agent would help you figure it out.

      Right now, without insurance, anything you use for your business probably isn’t covered inside of your home.

  • Reetuparna Roy

    Hi Alyson, Thank you for this very informative podcast.

    Thanks,
    Reetu.

  • Thank you Alyson for this wake-up call! Just sent off an email to our insurance company to get a quote for the home-based business coverage.

    Peg Lariviere
    Iroquois Falls, ON Canada

  • Hi Alyson,

    Very interesting and frustrating. These folks won’t work with artists in California. They say Western US, but that is not accurate. Just thought you would want to know. Maybe save any California artists from wasting time on this.

    Thanks

    • Valerie: While I know they can’t work with you in California, I thought anyone could get a quote. I was told it’s based on the West, but maybe Northwest is more appropriate. I will have Claudia come in and follow up if she can.

    • I am so sorry that you experienced frustration when attempting a online quote for California. Our agency is licensed in Washington, Oregon, Utah, Idaho and Arizona and those are the only states that are quoted on our website. My apologies if the “Northwest” reference wasn’t clear enough.

      The main goal of my interview with Alyson was education, not sales. I hope that the information I provided may have encouraged some artists to schedule a conversation with their local insurance agent to discuss their exposures and coverage options.

      Another option is Stratum Insurance, and agency that is licensed in 40+ states: https://stratuminsurance.com/biz/type/home-business-insurance/

      My thanks to Alyson for the opportunity to be interviewed. She provides such a valuable service to her clients and followers.

  • Thank you both so much for the follow-up information. I sure appreciate your time in providing such important and valuable information.

  • Thank you SOO MUCH Alyson, wonderful podcast and glad you mentioned us to listen to this category. Making the call to insurance agent Monday. Hope all is well. Hugs to you and Mesa! I may be out in CO end of August or September….tbd. Kasey Klein

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