Cabinet Making Business Insurance
Getting insurance for your cabinet making business is essential.
Cabinet making businesses need to be protected against lawsuits arising from things like defective products, false advertising, and employment disputes.
For example, your business produces a substandard cabinet that causes a customer harm, or one of your employees damages the customer’s kitchen while installing a cabinet.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Cabinet Making Business
General liability insurance is — generally speaking — one of the most important insurance policies for cabinet making businesses.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
There are numerous beneficial policies that will help you fully protect your cabinet making business from the many risks it faces. Some of these include:
- Product liability insurance: There’s always a slim chance that a customer is injured by one of your cabinets, this policy would cover the costs of legal defense if you were sued on this basis.
- Commercial property insurance: In the event that your business’s workshop or any other commercial property is damaged by a covered event, this policy will pay for the replacement of the damaged products.
- Workers’ compensation insurance: Any business with employees, part-time or full-time, is obligated by laws in each state to obtain this policy for the protection of their workers.
When it comes to the types of insurance providers you can purchase coverage for your cabinet making business from, there are two primary groups:
- Traditional brick-and-mortar insurers
- Online insurers
Although traditional insurers such as Nationwide and The Hartford are arguably more renowned, online insurers such as Tivly and Next are far more popular due to how much more affordable their policies are.
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Cost of General Liability Insurance
On average, cabinet making businesses in America spend between $500 - $1,500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a cabinet making business to other professional industries using the graph below.
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Common Situations That General Liability Insurance May Cover for a Cabinet Making Business
Example 1: While visiting your workshop, a customer slips on some sawdust, breaks a wrist, and demands you pay for his medical treatment. General liability insurance would cover his medical bills.
Example 2: As you transport a set of cabinets to your work van, you trip and lose control of the hand truck. The hand truck slams into the side of a customer’s luxury sedan. General liability insurance would cover the customer’s vehicle repair costs.
Example 3: While you install cabinets in a customer’s home, the customer trips over your tool bag, breaks an arm, and decides to sue. General liability insurance would cover your legal defense costs and any required settlement.
Other Types of Coverage Cabinet Making Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Product Liability Insurance
While you strive to make cabinets that truly satisfy your customers, there’s always a chance someone might claim your product caused them harm. In the event of a lawsuit, product liability insurance would cover your legal defense fees and any required settlement.
Commercial Property Insurance
You made a major investment to establish your cabinet making business. If you own the workshop in which you operate, commercial property insurance would cover the cost of repairing or replacing your business-related property in the event of a fire, theft, or natural disaster. This includes structural damage to your workshop as well as the tools, equipment, and other supplies you store there.
Workers’ Compensation Insurance
If you have any employees, most states will require you to carry workers’ compensation insurance for both part-time and full-time workers. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover, but also any disability or death benefits stemming from a work-related accident.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your cabinet making business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Cabinet Making Business Insurance FAQ
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Yes, it is imperative that you acquire business insurance for your cabinet making business before its operations begin. This short-term expense will reap dividends for your business in the long run.
Not to mention, it will allow your business to continue to operate legally, as it will likely be obligated to possess certain policies (e.g., workers’ compensation insurance).
Not necessarily. Certain exceptions may be written directly into your cabinet making business insurance policy, and some perils may be entirely uninsurable.
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.