Home workshop insurance

Pop Golden

Pop
Corporate Member
I'm wondering about home owners insurance for my workshop. I have around 650-700 sq. ft. in my basement. Its the equipment I am most concerned about. It's a few years since my last inventory. My best guess is I have around $80,000 worth of machines, cabinets etc. What are the rest of you folks doing about this issue?

Pop
 

tvrgeek

Scott
User
Good thought. I have expanded insurance for some personal items, but should ask about my tools as I am pretty sure it does exceen the standard ratio. Your agent can tell you.
Always good to have pictures of everything in a safe off-site place.
 

Graywolf

Board of Directors, President
Richard
Staff member
Corporate Member
It dose not at least in my experience. Like many things in life your hobbies like woodworking is treated much like a business by insurance companies. You as a homeowner will have to purchase additional insurance to cover any potential losses. This is not really great news if you re living on a fixed income,however, it is a harsh reality in the world we live in.
 

Michael Mathews

Michael
Corporate Member
My home owners insurance covers my detached garage and workshop including contents. There is a clause that includes the structure and contents and there is a value. Make sure it is spelled out as an item.
 

golfdad

Co-director of Outreach
Dirk
Corporate Member
I went over this with my agent. Shop and contents are covered under home owners
 

tvrgeek

Scott
User
I went over this with my agent. Shop and contents are covered under home owners
Yes, but the value may exceed the % of the house. Same with jewelry, art and other not too common personal items. If you do an analysis of everything in your house, you may be very surprised what it adds up to. Most people are way underinsured.

Now, if you sell what you make, then both NC will want to tax you and you may need business insurance.
 

chris_goris

Chris
Senior User
I'm wondering about home owners insurance for my workshop. I have around 650-700 sq. ft. in my basement. Its the equipment I am most concerned about. It's a few years since my last inventory. My best guess is I have around $80,000 worth of machines, cabinets etc. What are the rest of you folks doing about this issue?

Pop
Theres only ONE way to find out. ASk. and ASK before you need it.
 

Bernhard

Bernhard
User
Went through that exercise a couple years back. Even though my workshop (garage) is attached to the house by a breezeway, the insurance company categorized it as a separate building. So regular homeowner's policy does not cover it. My only option was to take out "inland marine insurance" and that was prohibitively expensive. I am not worried about large equipment (saw, planer, bandsaw, milling machine, lathe), since that stuff weighs way to much to be moved during a burglary. But I would take a big hit loosing hand tools and portable power tools. Also would be nice to have some insurance on tractor and skid steer, since that equipment can be driven offrather easily. But again it was just too expensive.
If someone finds a reasonable rate, I'd be very interested....
Thx
Bernhard
 

tvrgeek

Scott
User
Hmmm. I had better check. I think outbuildings are covered for me, but my shop is freestanding.
 

Bill Clemmons

Bill
Corporate Member
My free standing shop is covered on my home owner's policy as a separate entity, w/ a specific dollar amount assigned. We review all this w/ our agent every few years.
 

jcz

Johnny
Corporate Member
I know first hand that attached garage/shops are covered by home owners. We had a house fire a few years ago and lost all garage contents and 1/4 of our home. Luckily we had very good insurance coverage. I have been able to replace all of my equipment and built a designated shop. The garage is now strictly a garage.
 

tri4sale

Daniel
Corporate Member
You need to ask your agent. If the equipment is used to make money good chance it would be excluded. Doesn't matter if you call it a business, a hobby, or what not, if you make money off equipment it may not be included in coverage. I know this from experience after a fire. Also, is the policy replacement cost or depreciated cost, because if you suffer a loss you may not get enough to actually replace what you lost if it is depreciated coverage. This I also know from experience after a fire :( You'll see I said the word "may not" a lot, since it all depends on your policy.
 
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Keye

Keye
Corporate Member
What I just read above confirms what I have always believed. All home owners insurance policies are not created equal. You need to read your policy and talk with your agent but be aware your agent has no say in your settlement. The adjuster they send can also make a big difference. When Hugo hit I had about $100,000 in damage. The adjuster they sent was an idiot. He based his estimate on pre Hugo costs. I finally had the agent replaced and received a fair settlement. Two years ago a friends house was hit by lightning which caused a fire resulting in $200,000 in damage. He had insurance with some obscure never heard of company. After living in an RV, hiring 4 lawyers and 2 years later he is finally having his house repaired.

Always, buyer beware.
 

Keye

Keye
Corporate Member
I know first hand that attached garage/shops are covered by home owners. We had a house fire a few years ago and lost all garage contents and 1/4 of our home. Luckily we had very good insurance coverage. I have been able to replace all of my equipment and built a designated shop. The garage is now strictly a garage.
good for you but all policies are not like yours
 

drw

Donn
Corporate Member
I also discussed this issue with my insurance company. What I was told is that the shop and its contents are covered under my current homeowners policy. That said, I was also told that "IF" I sold products produced in the shop I would have to have a separate business policy.
 

chris_goris

Chris
Senior User
I also discussed this issue with my insurance company. What I was told is that the shop and its contents are covered under my current homeowners policy. That said, I was also told that "IF" I sold products produced in the shop I would have to have a separate business policy.
"If" you have a business..... otherwise, its just equipment in a building.
 

Oka

Board of Directors, Vice President
Casey
Staff member
Corporate Member
My policy does cover all items replacement cost including everything in the garage. But make a list and photo or video document so there is no question to what was in the building.
 

Chris C

Chris
Senior User
Chris is correct.... ASK and document your conversations. Ask specific questions and demand specific answers.

My shop and contents are covered under my homeowners. Yours may differ.
 

junquecol

Bruce
User
My policy covers detached building at 10% of the value of living structure. Not sure about contents though. BUT, I carry a $2000 deductible. Having been in construction all my life, I would fix anything under that anyway. Only one claim in forty years on TWO houses. During a MAJOR ice storm, a limb the size of my upper leg went thru roof of rental house ($250 deductible) porch. Adjuster wrote me a check for three times estimate to repair. His reasoning was possible concealed damage and having to open an additional claim, as they were SWAMPED!
 

wolfsburged

Bill
Corporate Member
My policy I believe caps detached buildings at 10% as well. Luckily my workshop is in my basement and attached garage. We had a burglary a few years back and found the hard way about certain item limits being underinsured. Our policy had specific limits for jewelry, cash, and firearms. Most everything else lumped into general coverage based on a total dollar figure based on home value, which again may or may not be enough. We added riders for specifically named high value items. Probably need to do another pass of evaluation, very easy to be under-insured. The additional insured items cost was very little per year.
 

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