When to Convert to Business and Obtain Product Insurance

[themidnightsapper]

This is our third year of making syrup. Year one was an experiment and we made a couple pints. Last year we added a gravity vacuum system and make a few gallons which we sold/gave to family, friends, and co-workers. This year we have increased again and expect to get 10 - 20 gallons of syrup and if this works out, our sales will go beyond the friends and family level. Next year we should reach the 20 - 30 gallon level and will then be close to maxing out what we can produce on the property we own. I know some of this will vary state to state, but at what point do you consider, or need to, operate under a business and/or get product insurance?

[johnpma]

Are you planning on selling retail, or on consignment or do you plan to keep selling to friends, family ect...

[themidnightsapper]

We are looking to sell at Farmer's market and/or local flee market. Also know a small store owner and could possibly go there also. Will also continue to sell to friends and family.

[johnpma]

We are looking to sell at Farmer's market and/or local flee market. Also know a small store owner and could possibly go there also. Will also continue to sell to friends and family. Of course insurance companies will always tell you that you need them and take your money:lol: I think that you will have limited exposure at that scale and that any kind of business insurance will not be required. There may be a way to put an umbrella on your home policy that will cover that "just in case" instance and I would also put a "Homestead" on your home

We have done small markets in the past with various items including homemade maple oat bread and never had a problem In fact at the Farmer's Market I don't think anyone is insured including the guys that sell beef and lamb

[wiam]

But it would suck if you lost your home because of a liablilty claim.

[johnpma]

But it would suck if you lost your home because of a liablilty claim. That's why I suggested a Homestead as protection

[mainebackswoodssyrup]

Some places may require the insurance, you should check with others at the market. We make 30 gallons/year and don't worry about the insurance. We were quoted around $700/year for liability and coverage of some supplies. The majority of the cost was the liability insurance. When you sell $1800/year and have to pay over 1/3 of it to insurance you will be in the red.

[wiam]

That's why I suggested a Homestead as protection

Don't think that will cover product liability. I have a farm policy. It does not include product liability. I have to a rider for that. Everyone has to pick their own comfort level. I also carry market liability which would cover someone getting hurt at the stand or a canopy blowing over on something/someone. The market we go to does not require it.

[devils11217]

whose your policy with? I am in the process of dealing with farm family to develop a homeowner with product liabilty for maple syrup.

[maple flats]

My policy is with Farm Family. Call them and get a quote. I have all of my insurance with them except medical. I have a farm policy and I think my Liability portion was about $500 a year. One issue there is that the insurance covers you for product liability regardless of whether you sell 4 qts a year or 1000+ gal.
Insurance is not cheap, but then just 1 lawsuit would cost you far more than 50 years of insurance bills even if you win the suit.

[johnpma]

Don't think that will cover product liability. I have a farm policy. It does not include product liability. I have to a rider for that. Everyone has to pick their own comfort level. I also carry market liability which would cover someone getting hurt at the stand or a canopy blowing over on something/someone. The market we go to does not require it. no I'm sure it won't however if there was ever a lawsuit and there was not liability coverage then the lawyer would next look at assets in which case his home would be protected I agree dealing with the public can be tough I think I would be more worried about people visiting your sugar house and getting injured over selling 3 gallons of syrup at a farmers market it's all risk management.......

[Michael Greer]

Don't worry about it at that level. I have sold over 100 gallons without getting past the family and friends bracket. The only reasons to become a "business" are bank loans or tax advantages. I'm willing to wager that no one has ever been poisoned by maple syrup.

[wiam]

Don't worry about it at that level. I have sold over 100 gallons without getting past the family and friends bracket. The only reasons to become a "business" are bank loans or tax advantages. I'm willing to wager that no one has ever been poisoned by maple syrup.

Not true. Vermont inspector has been to hospital twice that I know of from tasting syrup.

[jmayerl]

Not true. Vermont inspector has been to hospital twice that I know of from tasting syrup.

Please elaborate on this for us

[wiam]

I don't remember details but Henry Markeshas been hospitalized after tasting syrup. It may have been some kind of cleaner but I can't be sure of that.

[Woodsrover]

Second year tapping and I plan on making/selling 50-70 gallons of syrup this year. I have a "Farm and Ranch Policy" from State Auto. It covers my sugar shack as well as $300k in product liability. It's $557 a year. Its worth it to me for peace of mind.