Anyone know something about insurance?

[proxieken]

I need some advice on insurance.

I have a small plastic injection press in my workshop. I also have a couple of CNC mills and have a part time business making odds and ends. Mostly stuff I myself want. I was talking to someone who knows a good bit more than I do and we are playing around with the idea of making a car body. The mold is going to be a major challenge, but I kind of like to tinker with stuff just to see if it is possible.

So, I contacted a car company and asked about licensing. This topic was brought up on this forum before. Since then I talked to a guy who got clobbered by GM and spent $400,000 in legal fees. I absolutely do not want even the slightest chance of a problem so I am trying to go the legal route.

They seemed Ok with the idea, but require me to have a 1 million dollar product liability policy on the cars before they will go any further.

I contacted my regular insurance company and they refused to offer said policy. And as an extra little kick in the teeth, they dropped my homeowners coverage on my garage since I am now doing stuff in it. They sent me to a specialist, and he has not gotten back to me. He said I was a hard to place policy.

So it looks like the idea is dead in the water. Unless a smart person on this forum can tell me how to get an affordable million dollar insurance policy.

[dreinecke]

I know a bit. If you keep it defined as a "Hobby Business", I've found both my previous and current insurance companies were fine with that. A million $ liability may be tough anywhere to get. Have you considered an LLC or some other way to protect yourself?

[waaytoomuchintothis]

I can offer a "magic word" I used in Texas when I was assailed by rich jerks who prey on small businesses. There's an entire division of the disgraced legal profession that does nothing but stomp on nice people being productive. By describing my business as a "home vocational workshop", I was allowed to design and manufacture fine furniture unmolested. Before I dug that phrase out of a local ordinance's wording, I was defenseless because they could legally require me to spend so much money to keep them off my back (one stupid requirement after another, including building a fence around my garage and hiring a security guard for my lumber stash, in addition to ridiculous insurance of several types), I would have to operate at full throttle for 4 years to begin to pay off to a point where I was solvent.

[proxieken]

I make sure to keep another job, so I can just call it a hobby/business. I also have to call everything I make a hobby product because toy makers get pulverized with regulations. Employees are never going to happen. I was just trying to figure out a way to make some obscure stuff in 1/32 scale that might not otherwise be available. Resin has some limitations that I try to avoid. Besides, I got an injection machine and I might as well use it. I picked it up for scrap and got it working again.

The million dollar policy is going to stop this project in its tracks I think. I am trying to find someone online who can offer it, but really if it is more than a few hundred bucks I am not going to bother.

I know several folks who claim that no one cares and you can just go ahead and make stuff. But then this other guy told me about GM and it was pretty bad what happened to him. At this point the money I have invested is minimal, because all the equipment has paid for itself. I just have to buy metal and spend the time on making the molds. Or trying to.

A legal battle like that would pretty much ruin my life.

[The Old Jaybird]

I have some experience and some suggestions, call me tomorrow between 10 am and 10 pm, Eastern time and we can discuss.

TOJ

In real life.....

Jay E. Hodges, Principal
J. E. Hodges & Associates, LLC
Insurance Regulatory Examination and Consulting
770.312.8031

[ElSecundo]

[masmojo]

If your are familiar with Jules of Pioneer Slotcars he had some very sage explaination/Advice on this topic. Not sure where I saw it or if he posted it in several Places, BUT I want to say it was Either SCI or Slotforum (most likely the later)

Also, It would kind of depend on What exactly you were trying to do? Brand, Volume, Etc.? I think as you travel down this path you will understand why so many people simply go resin and use silicone molds! If you are doing a couple hundred units, you will have a different problem then if you are doing a few thousand (or more). Let's face it an injection molding die is going to be a hard one for any automaker to shallow, even if it's licenced!

As others have said if you avoid the DBA and designate this as more of a hobby you will avoid most of your issues. If you are trying to pay the mortagage and send the kids to college?? . . . . .er good luck! Resin casters with far less ambitious goals fall by the wayside all the time! :-(

[proxieken]

I read the posts by Jules. He was of the mindset of not to worry. I also talked to another fellow who pretty much got wiped out by General Motors. The 2 opinions are miles and miles apart. If Jules is wrong I simply could not afford to absorb the damage. While I am not saying he is wrong, this other guy scared the hell out of me. He lost his house and everything. I do know that Johnny Lightning simply changes the names and such, and that is a possibility. Instead of a Chevelle you just call it a Shovelle or something.

I am an S-corp right now. I make about 40-50 different little odds and ends. I think I made about 40,000 parts last year. Mostly contract stuff. Someone contacts me with an idea, I do up a CAD model, then a mold and send then a couple thousand parts. Most of my stuff went to the UK last year, which is sort of odd.

Not really overly ambitious, but there are a couple cars I would like to see made. I can do the 3d print and resin path. However, making a mold at this point only takes time. And a couple of pieces of metal. I could make the Palmer style cars but think they are sort of not real durable. I want to give it a go and see if I can do it with a side pull mold. I am working with a certified machinist who works at a plastics company. My sister is also in management at a plastic place the makes car interiors. She helps me with the engineering stuff when I get stuck. So I got a couple of people to ask questions of.

Resin is something I simply hate working with. The 3D prints I have gotten done have been costly and really not too nice.

I contacted 2 of the big 3 car makers. I will call and get some advice on insurance and see where it goes.

This is really just a crazy idea at this point. Usually I get something in my head and have to at least see if it is possible before I stop. Or if I get badly injured it tends to deter me as well.

Currently I am not really needing to make a huge amount of money. It is more of a challenge to see if I can actually make something in my little shop.

[masmojo]

OK, Yes, It's good to do your homework. I guess at this point my biggest concern is that there would be enough demand to warrant what you are trying to do???