Preparing your business for a disaster is something that most embroiderers do not have on the fore front of their mind as they are starting their embroidery business or even growing their business.
We do not think much about or even have it built into our business plan. If you do not have contingency plans built into your business plan you could lose your shirt, so to speak!
I personally have experienced 2 very devastating disasters in my business that I was not prepared for at all and my insurance agent was very neglectful in helping me to prepare for any type of disaster and it costs me financially and personally a lot of money! I was lucky that I was able to pull out of it, but if I had not had a lot of understanding and great customers, this would not have been the case.
Most Insurance agents do not understand the embroidery business and are in most cases not very informative when you are trying to get the right coverage that you need. They do not ask you the right questions and you do not know the right questions to ask.
One disaster happened to me when the roof of the building that I was renting space in, collapsed from the weight of heavy snow. At the time I had 2 single head machines, a 6 head machine and a 12 head machine. I also had screen printing equipment. It completely destroyed by office, computers, store displays and stock. This was at the beginning of January and I had just finished completing my books for the year and thankfully I had everything from my computer backed up in an external back up system that was not destroyed!
I had insurance to cover my equipment and none of it was damaged to the point where it had to be replaced, but I did not have any insurance to cover the $10,000 that it cost to have all of equipment uncovered from the collapsed room and to have it moved to a new location. Finding a spot large enough that would work for what I needed was not easy. I also had to spend money to renovate the new spot so that it would work for me. I had insurance to cover the loss of customers‚’ goods, but no insurance to cover the loss of time that we were out of business.
I want to share with you information that I received from Pat McKay ofMcKayIns.com about coverage that I could have had if I had asked the right questions. Our embroidery businesses are unique and the coverage that we need to have must be tailor made for our businesses. Here are 7 important questions that we need to ask our insurance agent when we first start talking to them about insurance coverage
- In the event of a claim, how will my software be covered?
- If my machines breakdown will I have coverage for loss of income?
- Are my machines and software covered wherever it is, such as at my place of business or at a show where I am exhibiting?
- Do I have coverage for other people‚’s property that is on my premises?
- Does my policy include liability coverage both on my premises and when I am at my client‚’s office?
- When I‚’m delivering finished products in my van, is the finished product covered by my insurance?
- Do you insure any other embroiderers”
If your agent does not or cannot answer these questions, you need to shop for another insurance agent. Insurance that doesn‚’t fit your business is like not having any insurance at all.
You need to talk to your agent about coverage for all phases of your business.
- Home Based
- On the Road
- On the Internet
- In your Retail Store
I want to share another incident that would have been much easier if I had had the right insurance.
I fell one morning coming out of church and broke my hip! Obviously I was not prepared for this and I did not have my business in the type of condition that anyone could come in and take over for me. I was in the hospital for a week and then at home for 3 months recuperating from this accident. I did not have any insurance to cover me if I was out and I had to struggle through that entire time working from my bed and an ironing board over my bed trying to keep up with as much of the duties that I could during this time.
My business was on the second floor with no elevator, I had no one that could take over my duties and it was extremely hard to try and keep up it was very costly financially. If I had had the insurance to cover me during the time that I was out, it would have been so much easier with a lot less worry. I was not prepared in any way to be out of my business for 3 months. Quality was slipping, customers were not happy and as a result, I lost a lot of business!
Pat McKay has some forms on her insurance website that I want you to go download and fill in. These forms will help you see where you are and what you need to do to get the right coverage. She has a complete “Planning Guide” that will help you be able to go to your insurance agent and make sure that you not only have the right coverage but will also have enough information to ask the right questions. I felt so much more intelligent when I went through this exercise. Download the forms and get them filled in! You will be so glad that you did!
If you would like to talk to Pat directly you can reach her at 330-665-7952 or email her at mckay@mckayins.com. http://www.McKayIns.com. Insurance and the right kind of insurance is so extremely important in protecting your business. Make this part of your business planning. You have worked so hard to build up your business, do not be in the position of a disaster that you are not prepared for and end of losing your shirt! It could happen! Don‚’t let it happen to you! You need to be prepared for any unfortunate disaster in your embroidery business!