Insurance
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Thread: Insurance

  1. #1
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    Default Insurance

    I have had a policy with State Farm to cover my small bee keeping and sale of honey. I could always envision a lawsuit for a variety of reasons. I have never had an issue. I recently read the policy and even though the broker says I am covered, I do not see anything in the policy for product liability, so I am going to switch next year. I do have home owners and an umbrella policy but I do not believe it covers liability for off site sale of honey. Can anyone recommend a company that sells insurance for beekeepers. I am comfortable that my homeowners and umbrella policy cover any issues that might arise on my back average where I keep bees.

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  3. #2
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    Default Re: Insurance

    Specialkayme, a poster on this forum, wrote an ABJ article back in the fall of 2018 on insurance and beekeeping (sorry, but I cannot recall the exact issue) and is doing a presentation at EAS in South Carolina this month. I don't know that there is a good insurance solution for hobbyist and sideliner beekeepers who are basically "one-man-bands."

    Discussing insurance is difficult, because many beekeepers here have been sold on a policy or a liability limitation strategy that they are confident works. However, when they are explained to any significant degree, I can usually spot some large holes. Fortunately, these risk management plans are rarely, if ever, tested. Claims against beekeepers are almost non-existent.

    Specialkayme and I are both attorneys. I have practiced for over 25 years and currently work in a field that includes contracting and risk management. And I cannot come up with a satisfying, cost-effective solution for myself. Therefore, I am still uninsured, yet I sell honey and keep 4 outyards.

    Perhaps things have changed for Specialkayme, but my memory of his article last Fall was that he, too, remains uninsured. Hopefully, he will chime into this thread.

    I am sorry I am not a help to you. There are insurance products out there and perhaps your piece of mind is more valuable than mine and you will not mind the premiums. I encourage you to search your options, yet be very skeptical of what you are being told. You were wise to read your insurance policy and figure out that you had no coverage. Most of us rely exclusively on our agent's assessment, and even though he/she may be well-intentioned, they can often be wrong.

    Please keep us posted if you come up with an insurance solution. There are many of us that would like to have a cost-effective solution.

  4. #3
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    I made a LLC and everything be related I use the Llc name even when buying equipment, bee removals, honey sales etc. I may be wrong but if someone gets stung up from my bees or sues me for whatever bee related thing they would have to sue the Llc for all its assets not me individually.

  5. #4
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    Default Re: Insurance

    Quote Originally Posted by amk View Post
    I made a LLC and everything be related I use the Llc name even when buying equipment, bee removals, honey sales etc. I may be wrong but if someone gets stung up from my bees or sues me for whatever bee related thing they would have to sue the Llc for all its assets not me individually.
    This is a pretty good discussion about the pros and cons of LLC formation for hobby beekeepers. https://www.beesource.com/forums/sho...t=Specialkayme.

  6. #5
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    Default Re: Insurance

    I am surprised there isn't a setup thru one of the larger beekeeping associations for the small folks to get a reasonable insurance. Our provincial association, the British Columbia Honey Producers Association, carries a policy available to members. 40 bucks to join the association, then 40 bucks to buy the insurance. For that you get a million in liability coverage for beekeeping and related endeavors, covers virtually everything except employees and an accidental forest fire start. For an extra hundred bucks you can get a million in forest fire coverage, and another 30 bucks bumps that up to 2 million.

    BCHPA has been dealing with this insurance agency for decades and most of the beekeepers I know in BC carry this policy. It's particularly important for folks taking bees out to yards on other folks property during the forest fire season. In our area to go onto a timber lease for fireweed flows it is required by the logging companies that operate the timber lease.

  7. #6
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    Default Re: Insurance

    I have created an LLC and the State of Illinois charges a substantial fee for yearly renewal. That of course is Illinois where they just raised the gas tax an additional 19 cents/gallon.
    The simple formation of an LLC does not stop lawsuits and they can be in the millions of dollars.For this reason if you have a reasonable net worth, even a home, it make a lot of sense to have insurance. I also remember a thread where this issue was discussed but cant recall where or when. I am going to try the agricultural extension service as they deal with these matters.

  8. #7
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    Default Re: Insurance

    grozzie2: I will check with ABF to see if they have some similar insurance affiliation, but I do not think they do. You are getting a heck of a deal through BCHPA. Kudos to them for providing such a valuable service. I might poke around to see if they require Canadian residency.

  9. #8
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    Default Re: Insurance

    Quote Originally Posted by Plannerwgp View Post
    I am going to try the agricultural extension service as they deal with these matters.
    That is likely an excellent place to start. Please post any results you get. Thank you.

  10. #9
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    Default Re: Insurance

    Quote Originally Posted by psm1212 View Post
    grozzie2: I will check with ABF to see if they have some similar insurance affiliation, but I do not think they do. You are getting a heck of a deal through BCHPA. Kudos to them for providing such a valuable service. I might poke around to see if they require Canadian residency.
    You dont have to poke very far. The policy is only available to members of the BCHPA, and membership is only open to beekeepers with hives in BC.

    I mis-spoke above on the rates, we had a rate increase this year, the basic liability policy is now $75, was at $40 for many years. I have vague memories of sitting in on a conference call late last fall where the insurance provider had mentioned rates on everything were up this year due to the volume of claims being paid out over wildfires a couple years ago, in particular the one that ran thru Ft McMurray and burned down a huge chunk of the city.

  11. #10
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    Default Re: Insurance

    Quote Originally Posted by grozzie2 View Post
    I mis-spoke above on the rates, we had a rate increase this year, the basic liability policy is now $75, was at $40 for many years.
    Still a fantastic deal.

  12. #11
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    Quote Originally Posted by Plannerwgp View Post
    I have created an LLC and the State of Illinois charges a substantial fee for yearly renewal. That of course is Illinois where they just raised the gas tax an additional 19 cents/gallon.
    The simple formation of an LLC does not stop lawsuits and they can be in the millions of dollars.For this reason if you have a reasonable net worth, even a home, it make a lot of sense to have insurance. I also remember a thread where this issue was discussed but cant recall where or when. I am going to try the agricultural extension service as they deal with these matters.
    https://www.investopedia.com/terms/l/llc.asp

    I’m not sure where you’ve gotten your information but everyone I’ve talked to that has llcs and knows the law told me the individuals property not under the Llc is protected from someone trying to sue the Llc. Even a basic google search says that as well. I’m in Texas and laws are different definitely more pro business than up north so maybe there’s a disconnect there. Someone can sue the Llc for a million but it’s not worth that here’s my 40 hives I guess and I go out of business. I do not discount good insurance coverage but if your selling bees and honey you got to file taxes and a Llc has more benefits then dba so from my perspective Llc was the first step insurance is next.

  13. #12
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    Default Re: Insurance

    Quote Originally Posted by amk View Post
    https://www.investopedia.com/terms/l/llc.asp

    I’m not sure where you’ve gotten your information but everyone I’ve talked to that has llcs and knows the law told me the individuals property not under the Llc is protected from someone trying to sue the Llc. Even a basic google search says that as well. I’m in Texas and laws are different definitely more pro business than up north so maybe there’s a disconnect there. Someone can sue the Llc for a million but it’s not worth that here’s my 40 hives I guess and I go out of business. I do not discount good insurance coverage but if your selling bees and honey you got to file taxes and a Llc has more benefits then dba so from my perspective Llc was the first step insurance is next.
    If John Doe is driving a truck for XYZ, LLC and, through his negligence, John Doe hits a school bus full of kids while driving XYZ, LLC's truck on official business, claims for negligence may be brought against John Doe and XYZ, LLC. It just so happens that XYZ, LLC has the deep pockets (i.e. the large insurance policy) and that is who ultimately bears the brunt of the legal settlement.

    If John Beek, the owner, beekeeper, and sole employee of ABC, LLC, through his negligence, sells a honey product that causes an illness in those that consumed it, claims for negligence may be brought against John Beek and ABC, LLC. ABC, LLC and John Beek are jointly and severally liable for the judgment resulting from that case. Everything that John Beek owns (with certain state-specific exemptions) will be subject to the judgment in that case. If ABC, LLC is an uninsured, shell company, with nothing more than a few thousand dollars of beekeeping equipment available for seizure, John Beek will make up the difference from his personal accounts, or declare bankruptcy to escape the debt.

    Last scenario is, John Beek, owner and beekeeper of ABC, LLC, owns a 1 ton truck in the name of ABC, LLC and employs Jane Doe to drive that truck. Jane Doe, in her official duties for ABC, LLC, through her negligence, hits a school bus. John Beek MIGHT receive some liability protection for his personal assets by virtue of being organized in the LLC. However, there will be a fight, John Beek will be personally named in the suit, and could spend $30,000 to $50,000+, before being released from the suit.

  14. #13
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    Default Re: Insurance

    To follow up on that, I do not want to give the impression that I think an LLC is always a bad idea. Nothing could be further from the truth and I have put hundreds of clients into LLCs over the course of my practice. There are several benefits to forming an LLC. However, for purposes of this thread, we are only discussing the issue of liability of a sole proprietorship. LLCs do not do much for liability protections for a Single Member LLC (One owner). However, if you and a buddy are going to join forces and assets and keep bees together as a going concern, I would not do it without first forming an LLC, severing ourselves from any liability that we could transfer onto each other. There are also other advantages such as treatment under the IRS "Hobby Rule" though it is not necessary to organize to get this treatment.

  15. #14
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    Quote Originally Posted by psm1212 View Post
    Quote Originally Posted by amk View Post
    https://www.investopedia.com/terms/l/llc.asp

    I’m not sure where you’ve gotten your information but everyone I’ve talked to that has llcs and knows the law told me the individuals property not under the Llc is protected from someone trying to sue the Llc. Even a basic google search says that as well. I’m in Texas and laws are different definitely more pro business than up north so maybe there’s a disconnect there. Someone can sue the Llc for a million but it’s not worth that here’s my 40 hives I guess and I go out of business. I do not discount good insurance coverage but if your selling bees and honey you got to file taxes and a Llc has more benefits then dba so from my perspective Llc was the first step insurance is next.
    If John Doe is driving a truck for XYZ, LLC and, through his negligence, John Doe hits a school bus full of kids while driving XYZ, LLC's truck on official business, claims for negligence may be brought against John Doe and XYZ, LLC. It just so happens that XYZ, LLC has the deep pockets (i.e. the large insurance policy) and that is who ultimately bears the brunt of the legal settlement.

    If John Beek, the owner, beekeeper, and sole employee of ABC, LLC, through his negligence, sells a honey product that causes an illness in those that consumed it, claims for negligence may be brought against John Beek and ABC, LLC. ABC, LLC and John Beek are jointly and severally liable for the judgment resulting from that case. Everything that John Beek owns (with certain state-specific exemptions) will be subject to the judgment in that case. If ABC, LLC is an uninsured, shell company, with nothing more than a few thousand dollars of beekeeping equipment available for seizure, John Beek will make up the difference from his personal accounts, or declare bankruptcy to escape the debt.

    Last scenario is, John Beek, owner and beekeeper of ABC, LLC, owns a 1 ton truck in the name of ABC, LLC and employs Jane Doe to drive that truck. Jane Doe, in her official duties for ABC, LLC, through her negligence, hits a school bus. John Beek MIGHT receive some liability protection for his personal assets by virtue of being organized in the LLC. However, there will be a fight, John Beek will be personally named in the suit, and could spend $30,000 to $50,000+, before being released from the suit.
    I read it on beesource it must be true. Those are not scenarios I envision anyway. I sale my honey to a highway stand it’s labeled with my Llc someone gets sick they don’t get to sue me they sue the Llc on the label.

    Next scenario someone gets stung by bees and says they were from the Llc hives again sue the Llc.

    In your example your operating a vehicle you need commercial auto insurance for that coverage your personal policy won’t cover you running a business

  16. #15
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    Default Re: Insurance

    Quote Originally Posted by amk View Post
    I read it on beesource it must be true. Those are not scenarios I envision anyway. I sale my honey to a highway stand it’s labeled with my Llc someone gets sick they don’t get to sue me they sue the Llc on the label.

    Next scenario someone gets stung by bees and says they were from the Llc hives again sue the Llc.

    In your example your operating a vehicle you need commercial auto insurance for that coverage your personal policy won’t cover you running a business
    Ok amk. I am not here to argue with you. From a liability standpoint, beekeeping is a low-risk business. Like I said, I am neither incorporated nor insured. So it is my hope that neither of us will need to rely on the protections we have, or have not, taken.

    And yes, it is an internet message board. Consume your information carefully. I could be the Queen of England or Betty Crocker. But I claim to be a 50 year old attorney with a 25+ year practice. And though I do not claim to be a good attorney, a significant portion of my practice has been in the area of business entities. While I feel confident in my knowledge on the subject, I have been known to be wrong more than I care to admit in my career. And you don't know me from Adam's house cat.

    You are wise to not get your legal advice from someone on this board. But I do encourage you to confirm your current understandings about your risk management plan with a QUALIFIED attorney and make sure your money is being spent on products that bring you the most cost-effective protections. Good luck to you and your beekeeping.

  17. #16
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    I’ve gotten sick after eating at a couple of places I swore it was food poisoning but I really can’t see trying to sue for it or even being able to prove that’s what it was in court. If honey is bad you would be able to tell.

    My understanding is a judge has to pierce the veil of Llc to sue the owner and there are specific conditions for that. I plan on reporting taxes this year so for me it was the next step. Insurance will be next year better to show up in court with a panel of attorneys vs just yourself.

  18. #17
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    Default Re: Insurance

    Quote Originally Posted by amk View Post
    Insurance will be next year better to show up in court with a panel of attorneys vs just yourself.
    Amen, friend.

  19. #18
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    Default Re: Insurance

    ps. 1212
    You are absolutely correct and you provided several realistic examples. I am not an attorney but I work with numerous attorneys and have done so for about 49 years. Everyone has to make their own financial decisions. I am probably overinsured but I own a company and am familiar with legal fees and lawsuits. Your advice is excellent.


    Quote Originally Posted by psm1212 View Post
    Amen, friend.

  20. #19
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    Default Re: Insurance

    Just Googled beekeepers insurance and one company is AON. I will contact them tomorrow.

  21. #20
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    Default Re: Insurance

    i have a 'business pursuits' rider to my homeowner's police with farmer's insurance that covers my beekeeping sideline. product liability is not specifically mentioned in the rider, but i requested and received a letter from the underwriter spelling out that product liability is covered by the rider.
    journaling the growth of a (mite) treatment free apiary started in 2010. 20+/- hives

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