Drop shipping business owners tend to think that drop shipping a product, selling a product without having to carry them in your inventory, means that you are not responsible for the product.
To an insurance underwriter, drop shipping means that the business owner has less quality control. To an insurance underwriter, Foreign manufacturers present a great risk since it's nearly impossible to hold them accountable for injuries in the U.S. that they should be responsible for.
It's your job as the importer to protect your customers from receiving defective products and ensure that imported products are safety inspected.
With that being said, there is a certain amount of liability a business must assume and drop shipping is obviously no different. Using the correct legal entity and liability insurance is vital to a successful drop shipping business no matter if it sells T-shirts, Tie Clips or Costume Jewelry.
Having the liability insurance can help you protect yourself and your business during hard times, plus it may help you pay for your legal fees if you have to consult with a lawyer.
Getting your drop shipping business insured is a priority that you can't afford to overlook.
If you’re one of more than 38 million people working from your home in any capacity, beware: your home insurance may not provide adequate protection for your business, no matter how small. Thanks to the digital revolution, it’s never been more convenient to earn a living from your living space – but with each reward comes risk, and without the right coverage, that extra cash flow can turn from positive to negative.
Unfortunately, too many at-home earners aren’t aware of the gaps in their coverage until they’re presented with a dire situation, be it a hurricane or any other disaster. Their inventory and business property can literally go up in smoke, ruined by a water leak, or be outright stolen. And if they are relying on their homeowner insurance to pick up the pieces, they may be surprised to find they have very little financial recourse.
So what should you look for in a home-based business insurance policy? It can be complicated – which may be why so many people don’t have the insurance they really should. If you operate or conduct any sort of business out of your home, be sure your insurance partner offers some, if not all, of the following coverage options to best protect your interests.
Here are 10 coverage options that every home-based businessperson should opt for:
1) Replacement Cost Coverage for your Home Business Property.Broadly, this covers business personal property and home business property or inventory– such as a burst pipe damaging a wedding photographer’s camera equipment. Replacement Cost Coverage for your Home Business Property also includes personal property owned by others in your care, custody, or control for business purposes. (Think that wedding photographer’s client’s photo album...) This versatile policy is available for most professions.
2) Coverage for Other Structures on your property used for Home Business. For businesses that store their business property in a free standing garage or other structure on their property, special coverage is needed. Direct sellers for multi-level marketing brands often have a supply of expensive jewelry, candles, skin care products, clothing, etc. in their garage. Make sure you’re protected if that structure collapses under heavy snow.
3) Loss of Income and Extra Expense Replacement. As an option to guard against dreaded downtime, this protection covers loss of business income that would have been earned (and related incurred expenses) during an interruption of home business, or when the premises is unfit for occupancy due to a covered loss. Loss of income and extra expense protection can help take the sting out of a terrible time.
If you have concerns about your business coverage contact us today.