Can't get insurance

[plymgary]

Hello,

I tried to get public/product/employee liability insurance through Simply Business but they were unable to help me. I then tried three local brokers who are also unable to help me. So, where on earth should I go?

Just in case anyone is interested, these are the criteria...

I run a business from home selling feathers and soon to start one selling cultural giftware (like singing bowls, Russian dolls etc). Both businesses will run concurrently.

No goods are kept on the home premises (it is admin only), but are instead located in a storage unit in Plymouth.

The total value of all the goods is around £10,000. Goods are packed from within this unit.

I import 80%+ of all the products from outside the EU (mainly China and South Africa). And, occasionally sell to the USA (although less than 5% of sales). Turnover for the current business is around £50,000 per year.

I am also looking to hire an employee to work from within the unit for 15 hours per week. The owners of the unit have agreed to this. The employee will be packing and dispatching goods. They will not work elsewhere, only from within this storage space.

So, any ideas where I can get a quote? It would be ideal if both businesses could be covered in the one quote. I think it's the importing from outside the EU that's causing the problem?

Thanks in advance.

 

[Nochexman]

Do you know why those brokers declined you for insurance?

 

[plymgary]

Thanks for your reply. They've both said it's because I import from outside the EU.

 

[obscure]

Thanks for your reply. They've both said it's because I import from outside the EU.

But what specifically is the reason. Is it that they are worried about the likelihood of damage in transit, is that they they are worried that they don't confirm to EU safety standards...? If you find out the specific reason you may be able to put in place processes to alleviate their concerns.

 

[Gecko001]

It appears that it is the product liability insurance that is the problem. Have you tried to get employers liability insurance on its own? This is something that you need by law. I do not think you need product liability insurance by law, but remember you do have to comply with all the UK laws and regulations that exist regarding the products you sell.

 

[14Steve14]

I was refused product liability insurance from a few companies because I import a few items directly from China. No reason was given that was really acceptable. I was told that it was fine to buy from someone within the EU that imported the same products from the same supplier.

I could not really get a handle what the difference was from a product bought direct from China or the same product bought from within the EU. Someone somewhere must be buying from the supplier in China.

I have since bought from the EU supplier and the packaging is exactly the same as that used from the manufacturer in China, so what the difference is I have no idea.

 

[plymgary]

Thanks for the advice everyone. I **think** I've managed to get something by going direct to AXA. Let's see if it goes through.

 

[Gecko001]

I have since bought from the EU supplier and the packaging is exactly the same as that used from the manufacturer in China, so what the difference is I have no idea.

The difference could be to do with the insurance company being able to sue ( or arrange for you to sue) the EU supplier in the event that you have a claim with them. The Chinese supplier would be harder to sue.

 

[lockyer]

your problems are few fold:

1. importing from outside EU - In this scenario you have little rights of recourse or control over quality. unless there is a written agreement with the supplier giving you rights of recourse you are effectively seen as the manufacturer of the goods and product liability stops with you under uk law.

2. Selling to North America - This is a straight decline for most SME insurers as NA is a very litigious society and the cost of defending claims is very high. This in itself isn't a massive problem, but generally the product liability would have to be sourced through Lloyds with a £1,500 minimum premium. My standard advice to clients with regard to NA is either Go Big or Go Home as the premiums (and the higher excesses) can wipe out the profit

3. spread of goods sold - most insurers at your level of turnover want you to fit in a box to allow the insurance products to be sold electronically via a broker. currently there isn't a classification that fits what you do

4. storage of goods - all standard policy's require that the premises where the goods are kept are under your sole control, and they are a permanent place of business. To cover the stock in storage you need a marine transit policy specifying the location - min premium £250 ish

 

[14Steve14]

The difference could be to do with the insurance company being able to sue ( or arrange for you to sue) the EU supplier in the event that you have a claim with them. The Chinese supplier would be harder to sue.

There are others on the internet that say the same, so there must be some truth in it.