Cautionary Tale

[kgg]

A friend of mind just this year and it's only January who has been operating her hobby in-house business for the last 15 years and was gearing down to retire has just been sued. She figures she will probably be severely hurt financially to the point of losing her home. She had operated a hobby in-house business on the assumption since it was just a hobby and operating out of the attached converted garage that she only needed to have normal home insurance. WRONG...

Well she had a client do a pick up earlier this month. That client slipped and fell in the driveway breaking her hip. The three wide paved driveway had been plowed and salted / sanded by a snow plowing company. The women was taken to the hospital for treatment, hip replacement and is recovering. 

My friend received a letter from the clients lawyer basically stating that she and everyone else involved is being sued so to contact her insurance company.

My friend did contact her insurance company who denied the claim as they considered it business related and she only had normal home owner insurance as well as they were canceling her policy.

So the bottom line:

It's probably worthwhile for fellow members to check with their insurance company and see if they have proper insurance coverage should anything unfortunate happen.

kgg

Edited January 27 by kgg

[rleather]

Never ever would I have a customer do a pick up at my in home business, just for safety's sake. You never know who what trouble you may be inviting. Thanks for posting.

[toxo]

The bane of modern "society" lawyers and insurance.

[fredk]

In the UK, at least in N.I., all visitors are 'trespassers' in law except 'legal visitors'*

'Legal visitors' are, (list not complete); post people, milk & dairy deliverers, parcel couriers, police officers, fire-fighters, paramedics . .  . . . These are covered by your home insurance. All others are not and take their chances and cannot sue for something that happens outside the home/house. They can try, and insurance companies will pay out on small sums to save having to go to court to fight it**

* I was taught this when I was postie

** 30 years ago there was a famous paving stone in a town called Coalisland. It was broken and part of it stuck up. Every month someone 'tripped' on it and 'fell'. They put a claim for hurt. The claim was usually for £2500. The council insurers paid up every time as each claim was less than the legal costs of fighting it. It took the council over two years to find the paving stone and replace it. I saw it once and the bit the people 'tripped' over was raised no more that 1/4 inch!

[kgg]

2 hours ago, fredk said:

In the UK, at least in N.I., all visitors are 'trespassers' in law except 'legal visitors'*

All visitors are trespassers. I love that. Do you get too "escort" them off your property with Mr. Winchester or at least a Shillelagh??

3 hours ago, toxo said:

The bane of modern "society" lawyers and insurance.

Sadly both are needed in this age but even sadder is the ones that will get the lions share are the lawyers.

kgg

[fredk]

1 hour ago, kgg said:

. . .  Do you get too "escort" them off your property with Mr. Winchester or at least a Shillelagh??

Yes. And in Eire/Ireland they will do just that if they don't want you on their property

[GatoGordo]

3 hours ago, fredk said:

In the UK, at least in N.I., all visitors are 'trespassers' in law except 'legal visitors'*

I am not sure I understand this correctly. Are you saying that if you walk into the local grocery store that you are trespassing?

[kgg]

27 minutes ago, GatoGordo said:

Are you saying that if you walk into the local grocery store that you are trespassing?

I think the grocery store would be considered a commercial / business not a home residence so would have different rules.In North America you can be considered trespassing and charged with trespassing at your local business under certain circumstances. Does it help with the dirtbags robbing stuff???

42 minutes ago, fredk said:

Yes. And in Eire/Ireland they will do just that if they don't want you on their property

Proper thing.

kgg 

[fredk]

In legal theory, yes

Unless you are 'invited' in. You are 'invited' in to trade by open doors and posters offering items for sale 

[GatoGordo]

2 hours ago, kgg said:

I think the grocery store would be considered a commercial / business not a home residence so would have different rules.In North America you can be considered trespassing and charged with trespassing at your local business under certain circumstances. Does it help with the dirtbags robbing stuff???

Proper thing.

kgg 

In this case, this was a business. In your words "she had a client do a pick up earlier this month." This was a customer invited into her place of business to pick up merchandise. Same as a grocery store.

2 hours ago, fredk said:

In legal theory, yes

Unless you are 'invited' in. You are 'invited' in to trade by open doors and posters offering items for sale 

The woman was invited in by being asked to do a pick up.

[kgg]

1 hour ago, GatoGordo said:

In this case, this was a business. In your words "she had a client do a pick up earlier this month." This was a customer invited into her place of business to pick up merchandise. Same as a grocery store.

That means the client was from the insurance point of view a customer not a visitor therefor there for business reasons. Her insurance was for what would be considered a normal home owner needs not business insurance coverage. Personally I have both home owner and business coverage that way I'm covered either way should something happen to my equipment, property, clients or visitors. Home owner insurance sometimes doesn't cover or has limited coverage on certain types of hobby equipment.

kgg

[fredk]

Who owns the driveway? It sounds too big to be for a single house. Is it a communal driveway serving a number of apartments?

[kgg]

36 minutes ago, fredk said:

Who owns the driveway? It sounds too big to be for a single house. Is it a communal driveway serving a number of apartments?

No just a private driveway serving one 1200 sq ft. bungalow. In this area most driveways are usually at least two vehicles wide and smaller properties have at least a half acre of land. In my area about 15 minutes from town I'm the smallest property with 120 acres. My driveway is just a touch over 300 feet long, 4 or 5 vehicles wide at the entrance. By the house my parking area would be about 60 feet or so feet square. My closest neighbor is about 1/2 mile away, still to close.

kgg

[toxo]

4 minutes ago, kgg said:

No just a private driveway serving one 1200 sq ft. bungalow. In this area most driveways are usually at least two vehicles wide and smaller properties have at least a half acre of land. In my area about 15 minutes from town I'm the smallest property with 120 acres. My driveway is just a touch over 300 feet long, 4 or 5 vehicles wide at the entrance. By the house my parking area would be about 60 feet or so feet square. My closest neighbor is about 1/2 mile away, still to close.

kgg

My property is about 120 inches.

[kgg]

1 minute ago, toxo said:

My property is about 120 inches.

Like that.

kgg

[bladegrinder]

A friend of mine had a friend over his house drinking, he fell down some steps and broke his arm. all was good at the hospital until his insurance company found out where it happened.

my friend got sued by the other guys insurance company. in this case my friends homeowners insurance took care of it. I never asked but I'm sure his rates went up.

[fredk]

When I was in business I was always being threatened to be sued. My solicitor advised me; own nothing. I rent my apartment, my car is loaned from my son etc. I have no insurance. If someone threatens to sue me I say go ahead but you'll get nowt. They soon drop the case

Edited January 28 by fredk

[Handstitched]

I think this will be one of  those threads that will get the " Hot "  tag 

7 hours ago, kgg said:

Personally I have both home owner and business coverage that way I'm covered either way should something happen to my equipment, property, clients or visitors.

Same here  

My workshop is around 30-40 feet away from my back door and is listed on our insurance papers as a ' small business' , we also have public liability ins.   . I have customers dropping off and picking up all the time.

I also have market stall insurance (with another company) public liability ins. up to $10mil. But thats another story.

Our premiums go up each and every year due to  the endless storms, bushfires , floods etc.mostly in the eastern states, but its us ,here in the west, that cops the huge increases. 

HS

[kgg]

6 hours ago, Handstitched said:

My workshop is around 30-40 feet away from my back door and is listed on our insurance papers as a ' small business' , we also have public liability ins.   .

Wise move.

kgg

[bruce johnson]

Insurance is a necessary part of business. There is just too much to lose no matter what your level of income or business size is as the original poster pointed out. For my example - I started with a new carrier and program two years ago when we found out that our then homeowner's policy was only going to continue replacement coverage on our 1200 square foot shop for $20K. That was their new limit on structures not attached to the house. Prior to that I only had a business liability policy (pretty cheap). Realistically I average 1-2 visitors a month to the shop, that is a minimal risk but still present. The new business insurance package has $200K replacement on the building. The inventory and equipment value coverage has a cap but fairly good and good liability coverage too. I opted for cyber-insurance that covers cyber-terrorism, website failure, business interruption, etc. In return I have to do secure computer backups at least weekly, have licensed fire extinguisher annual service, and a few other hoops that are mostly just common sense. Exclusions are no welding (don't anyway), no equipment loaning, and no employees. I had a guy helping me a few days a week as needed and had to let him go.  Otherwise - good piece of mind for the cost. We also just switched to a LLC designation which was fairly pain free.  

[kgg]

20 hours ago, bruce johnson said:

Exclusions are no welding (don't anyway), no equipment loaning, and no employees.

I would imagine most policies have their exclusions. I gotta agree with the no welding, hot splatters and all.

kgg

[TomE]

Typically have to prove gross negligence to claim liability.  Since she had a snow removal service treat her driveway she has a good case.  We have guests sign a liability release that explains the risks when trying out a horse or pony on our property, but we are still liable for "gross negligence."  We require a helmet, have our trainer present during the ride, etc.

[kgg]

13 hours ago, TomE said:

Typically have to prove gross negligence to claim liability. 

Sorry to say not up here in Canada. Your property, your liability even if the client / visitor is the negligent one. Even giving someone permission or unknowingly someone travels your land for hunting, etc it is a liability to the land owner. It's to the point you can't even help someone who gets stuck in the snow or drove off the road. If you use your tractor to pull them free chances are you will be accused of causing the damage to the vehicle even though it was caused by the driver and windup paying for the damages. Happen to a farmer neighbor a few years back. Gone are the days of being neighborly. 

kgg

 

Edited January 30 by kgg

[Handstitched]

3 hours ago, kgg said:

Gone are the days of being neighborly. 

Thankfully I have a good rapport with my (repeat) customers  but I do try to keep my workshop tidy , not just  for my own benefit and appearances, but also for safety for myself and customers 

HS 

[Mablung]

@kgg Did this accident occur in the US? If so, which state? The law relating to premises liability varies from state to state, although there are some generally applicable patterns and principles.