Knife Making and Home Insurance Dilemma

Troop

Troop

Well-Known Member
Hey guys, I'm in kind of a pickle, and need some advise.
My current homeowners insurance policy expires in a couple months, and my agent will no longer be an agent for the insurance company that I've had for many years.
So, I need to find a new homeowner's insurance company.
Here's the dilemma.....
1. I forge out in my driveway; not too much of a foreseeable problem with a new insurance company.
2. I have my Evenheat in my garage, which is an attached garage, basically underneath my bedroom. So, for all practical purposes, I HT in my house.
3. My KMG is in the same room in my workshop where my propane boiler (furnace) is.

I'm thinking that if the new insurance company does an inspection, they will not condone my knife shop in my house.

My options:
1. Tell the truth, and risk not getting insured, or, at the very least, paying an extremely high amount.
2. Lie. Hide all my equipment, and steel, and a lot of nicely figured and expensive wood that is drying in my humidity controlled finished basement (for handle material)

If anybody knows how insurance companies operate nowadays, please let me know what course of action would be best.

Additionally, I phoned one insurance company, and the first thing they asked me was, "Do you manufacture anything? Because we do house inspections, and if you lie to us, and we discover this, we will cancel your policy immediately."

Knife making is a very big part of my life, and I don't want anything to interfere with it. But, I need home insurance also.

Thank you for any advise that you can give me.

- Mitch
 
I have Allstate and they've never asked if I make anything in my house. Off hand I'd say don't lie but don't volunteer anything that they don't ask. Read the policy carefully and see what the restrictions are. Consider putting your heat treating oven on a cart that you can put outside under cover. It's a bear but you don't want to take a chance that you have a fire and you give the insurance company a reason, or at least an excuse, to reject the claim.

Doug Lester
 
Thanks, Doug. So, you recommend that I tell them,(if they ask, of course), that I do make knives, but that all the HT'ing equipment is used outside the house?
 
#1 Question: Are you a "Full-Time" knifemaker?
If not, you make knives as a hobby which means you are not a "manufacturer". Just remember the phrase, "I'm a hobbyist knifemaker".

#2, Do you have any prior military service? If so, I have the perefect insurance company for you.
Check out USAA.
 
"I'm a hobbyist knifemaker".
Click to expand...

That is the very best phrase that you can remember!!!

My situation is that I have two shops..the blacksmith shop and the finish shop. They are both detached from the house, and each other. I changed insurance companies 3 years ago, after we had a bad hail storm which tore up ALL the roofs, and the company I had been with for 20+ year (with never a claim) made it as difficult on me as they could when I filed a homeowner's claim.
Anyway, I now have State Farm, and they just flat out refuse to insure either the Blacksmith or Finish shops. The ONLY way that I could get insurance for the shops was through The Hartford, and that requires being a member of ABANA....and it's PRICEY.

Unless there is just no other way, YOU ARE A HOBBY KNIFEMAKER!
 
The real worry comes if you do have a fire of any sort. Your insurance will be null and void if it wasn't covered under a legitimate policy. It's that saimple. Can you sleep with that? Frank
 
Isn't it ok to have tools in a garage?

Might also just renew your current policy and get a new agent. Chances are reading over a policy would give the relatively few reasons that would void coverage. I can't imagine a hobby woodworker or hot rodder feeling obligated to push any issue that would raise premiums or risk coverage. Might want to treat a business in a different way.

Good luck with it, Craig
 
So, you guys seem to be all in favor of telling the truth to the insurance companies, just keep emphasizing that I'm a "hobbyist knifemaker" to keep me out of the "manufacturer" category. I wasn't crazy about the idea of hiding all my shop equipment and supplies and having to lie, but, like what happened to Ed, I didn't want the insurance companies to refuse to insure me.
Something else that I just thought of...I have my 200 lb Fisher anvil parked out in my driveway, mounted on a stump, next to my blacksmith's vice. These insurance guys aren't stupid; they would know something was up when they lifted up the covers on those things.
Do you think that the insurance companies would have a problem with my KMG in the same small room as my propane furnace? It's been there for a good 3 years, never had a problem.
It's about 8 ft. away from furnace... the sparks don't even come close. Maybe I should temporarily move it inside my garage some where.
I have my welding tanks (oxy/acetylene) stored in my garage, also. Maybe I should move those, too?

Frank: I'm not concerned about causing a fire. I have my Evenheat set up just inside and in between my two garage doors, and my quench tanks just (maybe 2 or 3 feet) outside on my driveway. But, of course, I'd like to be covered anyway. Thank you for the reply.

Ed: Thanks for the info. Your shops are detached from the house, and the insurance companies were giving you a problem! My shops are technically inside my house, that's why I'm really concerned about this whole mess. At this point, it's almost like cost is not an issue. As long as I can keep making knives, and have my house insured, I really don't care if it costs me more money (within reason). I'm paying around 1,500.00 bucks a year for the policy that is going to expire, which is really high to begin with, and it doesn't even cover anything about knifemaking. I'll have to check into The Hartford.

Craig: I was going to simply renew my current policy with another agent. Several months ago, when I received a letter from the insurance company indicating that my current agent would no longer be servicing their policy, they sent me a short list with 2 or 3 agent in the area that would service their policy. A few days ago, I phoned the company because I lost the list. The telephone system of the insurance company did everything it possibly could to avoid having me speak with an actual agent. Finally, some woman with an extremely heavy accent gets on the line and advises me that my former insurance company was bought out by some other company.. When I asked her for a list of agents in my area who I could use to renew my policy, she said that she didn't know what agents could service my policy. Needless to say, I got a real bad feeling in my gut about sticking with this company.

Murph: I served 4 years in the Army Infantry. It was during the Cold War. Some entities don't consider you a veteran unless you saw actual combat. Thanks for the info; I'll have to check it out.
 
It might be worthwhile to speak with an independent agent who's not tied down to one company. Those folks make their living doing the "shopping around" for you.
I'll be keeping an eye on this thread because I'm in a similar situation.
 
murphda2 said:
#1 Question: Are you a "Full-Time" knifemaker?
If not, you make knives as a hobby which means you are not a "manufacturer". Just remember the phrase, "I'm a hobbyist knifemaker".

#2, Do you have any prior military service? If so, I have the perefect insurance company for you.
Check out USAA.
Click to expand...

Murph, I just looked up their web site. There's a button that you can click to get a quote. Do you think I should even mention knifemaking at all? Why open up a can of worms unless I have to.
 
james terrio said:
It might be worthwhile to speak with an independent agent who's not tied down to one company. Those folks make their living doing the "shopping around" for you.
I'll be keeping an eye on this thread because I'm in a similar situation.
Click to expand...

James, I was going to go with the idea, like, "I'm a very private person and don't want people snooping around my house." But, after speaking to a couple people about going this route, they said that would just send up "flags" immediately and make them suspicious of my reasons for trying to conceal something. Then they definitely will come out to inspect.
 
I think that you are thinking about this way too much.

Chances are an insurance agent that comes to inspect knows nothing about knives or knife making or knife making equipment. They don't know what a KMG is or that it might make sparks when grinding steel. If they ask you are a hobbyist and do a little knife making, a little wood working and maybe some blacksmithing.

You are more likely to have a kitchen fire than setting your house on fire with an evenheat oven. Do you think that a guy who does his own auto repair is not going to get insured because he has a welder, oxy/acetylene tanks and power tools in his garage?

I would not say anything, and if they ask what certain tools are they are for wood working. That is much less threatening than saying that you make knives!
 
Thanks, Chuck. I've never been accused of thinking too much! (smile)
If the insurance companies will not insure me, I will be really screwed. In the event that happens, the mortgage company will want payment in full immediately for the balance of my mortgage.
This is not a trivial matter, at least to me.
As far as keeping oxy/acetylene tanks in my garage, my garage is under my bedroom.
Hey, I don't know how nit-picky these insurance people will get.
 
Another reason to remember the phrase "I'm a hobbiest knifemaker", or better yet, "I'm ONLY a hobbiest knifemaker" is that the city might shut you down if they get a complaint that you are running an industrial bussiness in a residential area.

Doug Lester
 
Troop, I just re-read your last post and you might want to consider getting a small outside shed to keep your acetaline torch in. All an insurance angency would need to do is claim that you were using in in the garage or it contributed to the distructiveness of the fire and refuse your claim. Wayne Goddard tells of an incident that he had with an acetyline tank in his connected garage. When he told his agent about it he was informed that if it had caused a fire he would have been on his own in coving any damages.

Doug Lester
 
Yeah, zoning rules can be a real pain, never mind the insurance. I'd love to get a DBA/state seller's permit so I can claim at least some of my expenses, but my towns publicly-available zoning info is really vague and seemingly arbitrary*. It just says "Contact the building inspector" yeah... like that's not gonna put me under a microscope. At least my garage is detached.

On the other hand, like Troop I don't want to end up in trouble with the township/state OR insurance company. Maybe Ernie Swanson will chime in, IIRC he looked into the whole zoning thing at his place awhile back. Naturally every municipality is different.



*When my Dad was alive (in the house I now own) and health issues put him in a wheelchair, the town wouldn't let him build a ramp to the front door facing the street, because "that constitutes a deck, and we don't allow decks in front yards here." But they did give him a building permit to put the ramp off the side door, and the ramp runs right out between the driveway and front yard, totally visible from the street. CONFUSED! Sorry for the rant, it just illustrates that sometimes the rules don't make any sense.
 
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First thing first, for safety purposes, I would be sure that I had a proper containment cabinet for any combustibles which I stored in an attached garage (you wouldn't store a gas can under your kitchen sink would you?). It's always better to be safe and get a simple metal cabinet to store your combustibles in to protect from accidental ignition.

As far as USAA is concerned, they recently opened membership to all prior service personnel. All that is required is that you have been "honorably discharged". One thing I have learned is that you get better rates with the more services you use. The first thing I would do is open a small checking or savings account with them. I received a lower insurance quote once I had done this. If you have any questions about thier service, feel free to contact me with your phone number and I'll share my personal experiences with them. Thier customer service has been exceptional!
 
James, be thankful that you don't have to work with historic preservation committees. We had to put a handicap ramp on the back of the church I attended in Virginia because the presevation committee wanted it hidden from view even though the city said that we had to be handicap accessable in what I understand was in a rather convoluted way. Of couse the church wanted to be anyway.

Doug Lester
 
I hear you, Doug. I'm a law-abiding kinda guy and don't like to ruffle feathers (much) but geez sometimes stuff like that is frustrating.

Murph, you're absolutely right, a good GROUNDED steel cabinet is never a bad idea for any kind of solvent or VOC. (thinners, fuels, oils, and so forth) It sure doesn't hurt to ground individual containers, either. Even a plastic jug or barrel can spark under the right (wrong?) conditions just by static. (remember rubbing your sock feet on the carpet and zapping your mom when you were a kid? ;))
 
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Thank you all for your replies. I usually don't ask anyone for advice about anything, but I'm really glad that you guys are there to help me out.
- Mitch
 
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