Business By saberger Updated 9 Oct 2009 , 11:23pm by saberger

saberger Posted 22 Sep 2009 , 1:14pm
post #1 of 22

If I rent a kitchen, by the hour or month, what kind of insurance do I need in order to start my biz and be covered? And where do I get through?


21 replies
saberger Posted 22 Sep 2009 , 3:22pm
post #2 of 22


Cupcakeluv24 Posted 22 Sep 2009 , 3:32pm
post #3 of 22

Wish I could be of help. I know someone has the answer out there.

cakesweetiecake Posted 22 Sep 2009 , 4:13pm
post #4 of 22

I am in a similar situation. I will be renting a kitchen by the hour and will be looking for insurance as well. The person that I will be renting from gave me the phone number to his agent. I plan to call him and a few others to compare prices.

Here's some other thread that may help you

grandmom Posted 22 Sep 2009 , 4:17pm
post #5 of 22

Why not contact your homeowners or automobile insurance agent? They will likely sell other types of insurance as well, or will know someone who does.

indydebi Posted 22 Sep 2009 , 4:19pm
post #6 of 22

I am not a licensed Property/Casualty agent, but I worked 15 years in P&C insurance; I was a licensed life/health agent for awhile. With that background .......

You will need a business liability policy; a policy that covers your equipment; if you deliver cakes, possibly a commercial auto policy.

As I always advise with this type of question: Talk to your insurance agent. Insurance is contract law and there's a reason agents have to be licensed. There is SO much to know and so many legal implications. Agents have to carry Errors and Omissions insurance, just like attorneys.

They will know what you need and will find the best carrier with the best price for you. Do not try to shop this yourself. Call. Your. Agent.

saberger Posted 22 Sep 2009 , 4:53pm
post #7 of 22

Thank you SO much for the information! I will check it all out.

leah_s Posted 22 Sep 2009 , 9:13pm
post #8 of 22

Also contact a State Farm agent. They insure a lot of small "bakeries." I just identical coverage to what I had previously for less than half the cost.

PS, I used to be a licensed Life and Health agent also. ::waves to Deb::

indydebi Posted 22 Sep 2009 , 9:29pm
post #9 of 22

leahs, I KNEW we were soul sisters! thumbs_up.gif

saberger Posted 7 Oct 2009 , 9:49pm
post #10 of 22

Can anybody give my an idea as to what it costs? I know it varies on the area and such, but would it be a couple of hundred $ or a couple of thousand?

indydebi Posted 7 Oct 2009 , 10:09pm
post #11 of 22

A $1million liability policy will run $250 to $500 a year. Property coverage will depend on your propery (equipement) that you need to cover.

Commercial auto varies GREATLY by state. GREATLY! (When I worked in P&C, I had an agent who was licensed in all 50 states, so I was required to know the laws for all 50 states and be familiar with the different rates. let's just say I'm glad I dont' live in Texas or Michigan!).

To give you an idea of what happened when I converted my coverage .....

We had 3 vehicles on our personal auto policy with an annual premium of a little over $900. I moved 2 of them to a commercial policy and the commercial premium ..... for JUST THE TWO vehicles .... was over $2200. A couple of years later, I had another agent review my policies (which you should do periodically just to be sure you're still getting a good rate) and he said my premiums were really good and he couldn't even come close to meeting them.

saberger Posted 7 Oct 2009 , 11:26pm
post #12 of 22

thanks indydebi. Is that what I would need to get...$1M liability? Then I need property and auto? Is that it?

indydebi Posted 8 Oct 2009 , 12:18am
post #13 of 22

$1M is usually the minimum amount required by any venues. Plus it's usually the min amt that an ins company will write.

Talk to your agent and he/she will be able to hep you figure out exactly what you need for your situation. thumbs_up.gif

bettinashoe Posted 8 Oct 2009 , 12:39am
post #14 of 22

Since you're renting the kitchen by the hour, saberger, property insurance would not be applicable because you can only insure "your" property on a property insurance policy. Since the property belongs to someone else, you will have to make sure your commercial liability policy covers the owner's property that you are using on a rented basis. You would only be liable for damages done to the property while you are on premises or which were due to your negligent acts (leaving the oven on and causing a fire, etc). So, you really only need liability and auto if you are delivering your product but make certain your agent knows you are renting the space by the hour as you may have to have some type of rider (possibly depending on your rental contract) covering damages to the physical property due to your negligence.

saberger Posted 8 Oct 2009 , 12:45am
post #15 of 22

Thanks again for the info. Things are sort of changing directions right now. I may have someone to partner with me and rent the location straight out from the owner.

Bettinashoe...Now, since it is a separate building owned by a restaurant, does that still apply, or would I need to get the property insurance?

bettinashoe Posted 8 Oct 2009 , 1:08am
post #16 of 22

You normally cannot insure property that does not belong to you. That is the difference between property coverage (insuring your own property for the actual cash value or replacement value) and liability coverage (insuring that another party is made 100% whole should they be injured or damaged as the result of your negligence). Most of your needed coverage would be fall under the liability section of a policy. Your rental agreement may specify that you are responsible for and/or insure the equipment in the building and you would, in that case, have to find coverage which would include this "rented" equipment. I can't see that happening but you'll need to make sure the landlord's equipment is also not excluded from coverage should there be a loss.

besweet2lissy Posted 8 Oct 2009 , 1:26am
post #17 of 22

Hi. I am a licensed insurance agent in the state of Florida. Since insurance is regulated by the state, if you are in a different state, the rules and/or requirements may be different. You are definitely going to need some form of Liability coverage, such as 'Products Completed Liability'. If you have any expensive equipment, such as ovens, mixers, etc., you will need a Business Property policy. Also, a good place to start is your current insurance company. If you have State Farm or Allstate, they should be able to get you what you need. If for some reason they are not able to write the policy for you due to state restrictions (such as in Floridaicon_smile.gif, they should at least be able to point you in the right direction and give you a few phone #'s.

I hope this helps. Good luck and God Bless icon_smile.gif


mcook1670 Posted 8 Oct 2009 , 1:39am
post #18 of 22

I just got my policy today, I pay $262 a year for a 2mil policy. I have general liability insurance that covers the kitchen that i work in. Make sure your insurance agent insures you as a baker and not a cater huge difference in price, my other agent had me as a cater and it was almost $800 a year, more than 3x as much.

indydebi Posted 8 Oct 2009 , 1:43am
post #19 of 22
Originally Posted by mcook1670

I just got my policy today, I pay $262 a year for a 2mil policy. I have general liability insurance that covers the kitchen that i work in. Make sure your insurance agent insures you as a baker and not a cater huge difference in price, my other agent had me as a cater and it was almost $800 a year, more than 3x as much.

Excellent point. We caterers have much more risk (i.e. food safety issues) than a baker does. More risk = more premium!

saberger Posted 8 Oct 2009 , 2:33am
post #20 of 22

Thank you everyone for enlightening me icon_smile.gif Another dumb question: how is the cost determined? Just by the amount of coverage I want or by the amount of biz I do or size of the location?

bettinashoe Posted 8 Oct 2009 , 11:56am
post #21 of 22

Cost is determined by the coverage you are wanting on a liability policy. Factors that are taken into consideration are the state and county/city you are in as some states have higher rates than others just because the particular state's insurance commission has approved the rate. Having been in the insurance industry for the past 25 years I can tell you the higher coverage is not going to cost you much more at all. As someone else mentioned make sure your writing agent knows you are a baker and that you have the coverages you need for your line of business. Other considerations on rates would be driving record if you are securing a commercial auto policy, credit history if you are securing a property/ contents policy. You've gotten a pretty good idea from the posts on here of about what you should be paying for a $1m liability policy. Most commercial policies should run about the same. Also as someone mentioned State Farm and Allstate are trying to open the door to commercial policy writing and you may be able to get a good policy from one of them. The only problem I've seen in the past with these two carriers is that they are not as forgiving as a strictly commercial carrier would be if you have a loss.

saberger Posted 9 Oct 2009 , 11:23pm
post #22 of 22

Thank you so much for all of your help! I called State Farm and after much discussion, got a rate of $176 for a $2M policy! Once I get the kitchen cleared, I will go ahead and do that. Thank you again!!

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