Liability Insurance For My Gun Leather Business

[Randyc]

I'm now of the point of shipping out several holsters a week. I believe I should consider obtaining a produuct liability insurance policy. Anyone have any recomendations for an insurance company and how much can I expect to pay for a policy?

Thanks

Randy

[woolfe]

Great topic! I'm subscribed!!!

I just started doing this, and I'm only planing on doing this part time to help get me through school and for fun after that. At the same time I wouldn't mind investing in some insurance. I would hate to lose my assets because of some ignorant idiot who shot himself in the foot/leg holstering a gun with a trigger shoe in a holster designed for a stock gun.

[BOOMSTICKHolsters]

Kevin has some pretty sage advice on this topic, Randyc. Maybe you should shoot a PM his way and see if he will share his thoughts on this subject. You might also look into pre-paid legal representation if a liability policy proves too costly.

note: I am not a lawyer, nor did I stay in a Holiday Inn Express last night.

[Bree]

I'm not in insurance anymore but I can speculate that this coverage won't be cheap by any stretch of the imagination. What I can say is that if I were making holsters the very first thing that I would do is either flat out incorporate (Inc) or organize my business as an LLC. Get your personal assets out of the reach of creditors. There is no question in my mind that you are at higher liability risk than someone making leather belts or the like.

For example...

http://www.ocregister.com/articles/gun-law...579-chavez-shot

My $.02.

[TwinOaks]

Wow, this is something I never considered! Thank You for bringing this subject up, I will definitely have to look into this. My father works in the insurance business and I'll give him a call and seek his input.

Another thought: Can a holstermaker provide a "I won't be held responsible" disclaimer with holsters? With most things horse related (in Alabama) we have an "equine activity law", which states the owner/trainer/stable/et al are not responsible for injury or damage because the person is knowingly participating in a potentially dangerous activity. Could something like that appy to gun related activities?

[Hedge]

I'm not in insurance anymore but I can speculate that this coverage won't be cheap by any stretch of the imagination. What I can say is that if I were making holsters the very first thing that I would do is either flat out incorporate (Inc) or organize my business as an LLC. Get your personal assets out of the reach of creditors. There is no question in my mind that you are at higher liability risk than someone making leather belts or the like.

For example...

http://www.ocregister.com/articles/gun-law...579-chavez-shot

My $.02.

Read the article. I'd arrest the cop for child endangerment and boot him off the force for such negligent and totally brainless behavior.

Hedge

[Bree]

Wow, this is something I never considered! Thank You for bringing this subject up, I will definitely have to look into this. My father works in the insurance business and I'll give him a call and seek his input.

Another thought: Can a holstermaker provide a "I won't be held responsible" disclaimer with holsters? With most things horse related (in Alabama) we have an "equine activity law", which states the owner/trainer/stable/et al are not responsible for injury or damage because the person is knowingly participating in a potentially dangerous activity. Could something like that appy to gun related activities?

A disclaimer like that isn't worth the paper its printed on. It won't stop the lawsuit. For a little business, if you get sued at all, you lose whether you win the case or not. More often than not, you get the insurance coverage just to pay your legal fees.

And... most courts will toss the disclaimer anyway so what good is it?

[TwinOaks]

After speaking with my father, he related that on a small scale (using me as an example) the insurance would be incredibly expensive. There are "non-standard" carriers who would be happy to take your money, though. The scenario we discussed using me as an example is paraphrased as follows:

I make maybe 3-4 holsters/ quarter. Getting insurance for that would start at about $2500. If something happened and I got sued....well, I got nothing to take. I have little to none in tangible assets, and taking the house would put the wife and kids on the street. Were it to happen, I would contact the attourney and explain that I've got nothing worth suing for. Sure, I could get sued for $10,000,000, but there's nothing to get. A lawyer (who'd be suing EVERYBODY) would probably drop the suit against me and go after others.

So for someone like me, well, I almost have "nothing to lose".....well, there's reputation and my beat up old Ford. Lawyers are more usually after money, and won't chase those without it unless they're trying to prove a point.

That's presuming that the holster was at fault in a ND/AD. In the case you referenced, the biggest issue IMO is why a 3 year old wasn't properly secured in a moving vehicle. That and why a Police Officer left a cond. 1 pistol in the child's reach. etc. Probably is gonna do more harm than good, unless it's just a nuissance suit and he's hoping to settle out of court. Back on topic.....the insurance would be worth it if you have a shop and are doing it as a business (incorporating is an excellent idea, per Bree). For me, the cost of the insurance doesn't make sense, so I only build holsters for people I know.

[Shorts]

I've been over this topic as well for myself. I've decided the first step would be to switch from sole proprietorship to an LLC. That may be the most basic step I can take. Next easiest step would be to have a personal rider on home insurance (details would have tro be reviewed but a rider never hurts). From there also pursue business related insurance. I've tried this already by making a few calls. Unfortunately it wasn't as easy as the websites said it'd be. This avenue still has to be investigated further.

[Bronson]

A business savvy friend of mine suggested something like this. Start TWO businesses. The holster making business (in this case) is incorporated or an LLC, thereby protecting your personal assets from lawsuit. The second business can be incorporated or simply be created with a "Doing Business As". This second business owns all the tools and tangibles and leases them to the incorporated holster making business. This way the holster business owns zero tangible assets so there is literally nothing to take.

My accountant girlfriend once told me that her business law instructor (a practicing corporate lawyer) called the LLC the best thing to ever happen for small businesses.

Bronson