so i\\'m trying to figure out costs for starting my own cake business. my question is...for those of you who already have a business...how much do you spend on insurance?

i am planning on renting a commercial kitchen one day a week. i work by myself and have no other employees.

does anyone have a guess on how much i should expect to spend? thank you!

It would be helpful to know where you are as insurance varies greatly by location.

HTH

My insurance costs about $250 per year. If State Farm sells insurance in your state contact them. They have a program for small bakeries.

leah_s That sounds pretty cheap, do work out of home or have a cake shop? I was just quoted for insurance for a bakery shop and was told somewhere between 500-700/? I do have a state farm in the area they are usually much higher but if they offer a special for bakeries maybe I will give them a call. BTW I live in Ohio.

Ours is around $230 a year, we share a commercial kitchen with a catering company.

I pay over $500 a year for 2 million in coverage. I am a one person by appointment only cake studio.

Are you including liability in your insurance?

we have State Farm and are paying $325 a yr for $1 million with renters insurance, and liability. We have a shop and are there 6 days a week.

A lot of companies have a minimum premium of $500. If you can find a company that does not have a minimum premium, your policy can be less than $500 for the year. However, keep in mind that most commercial policies are based on your gross receipts. For example, if you gross $30k a year, your premium may be very minimal, but as you grow, and as your receipts grow, your premium will grow as well. Bakeries with $100k gross receipts pay a lot more for insurance than a start up company with $20k gross receipts.

Also, a GL policy provides coverage for liability only (damage to others or their property). If you need coverage for your business personal property, make sure you ask for a BOP (Business Owners Policy), which is liability coverage and coverage for your "stuff" (pans, bags, buckets of fondant, inventory etc)

HTH!

So after reading this, I called my State Farm agent to ask why my insurance is so much higher than anyone else's on here. We are paying $500.00 to insure the shell of the the building, which my husband and I own and then the business is paying over $1400.00 for one million in liability and for up to $50,000 in case anything happens and we have to replace equipment. Sure seems like a lot when I read this thread. Might be California but....

My agent said I need to be sure I'm comparing apples to apples, so let me ask: Leah, do you have equipment covered in that $250.00? Would you mind sharing how much? Anybody else? What does your coverage include beyond liability?

I want Leahs insurance too! Mine is $585.

itsacake, coverages are obviously something you should compare apples to apples on, but it's your gross receipts too - that's really important. It's a huge rating factor. And maybe Leah's policy doesn't provide building coverage?

Thanks, yummy.

I'm a start-up with almost no receipts so far, so it isn't that. I think it is probably the combination of California and the amount of "stuff" I need to insure....

I don't mind paying if this is what it costs. I just need to do due diligence and this thread "perked up my ears" so to speak. I'll be sure to continue the discussion with my agent. I do understand that renting a kitchen one doesn't have a lot to insure. I did that for a while before I built my own.

see my post on insurance on this thread: http://cakecentral.com/cake-decorating-ftopicp-7038519-.html#7038519

Just want to make sure when you say "insurance", that you're comparing it one-on-one. I paid over $3500 a year but that was ALL of my insurance coverage ... not just one piddly liability policy.