Don’t wait until it’s too late.
Usually when artists start selling art, at first they don’t worry about the formal business set up. They test the waters, they hope people buy, and then they start learning about marketing.
But what falls through the cracks most often is the legal stuff.
It’s one of the first things I talk to my one-on-one clients about – do they have their business set up as a legal entity with the government, depending on that set up they might need or want a separate business bank account, and it’s possible they need insurance depending on their ideal business model.
Before I go further, one legal thing I have to do too is remind you that I’m not your attorney (I’m not an attorney at all) and I can’t give you professional legal advice. Everything in this article is generic advice to help you begin your research. But I strongly advise you to consult with a lawyer before deciding whether or not to get any type of insurance for your art business, or otherwise.
There are a few different things that can be insured in an art business: the art, the studio, liability for other people’s interactions in the studio, and liability for other people’s interactions with the art.
If you are insuring the art, you are doing so to protect yourself if the work gets damaged. This may be important while the work is in transport, while it’s showing in an exhibit or shop, or even while it’s inside your studio (accidents happen!).
You can easily purchase insurance for the art while it’s being shipped from the same place you get the art shipped. It’s usually fairly inexpensive to cover a large value and some companies, like UPS, have free insurance up to a certain value which could be useful for smaller works.
When you want to insure the art while it’s showing or in your studio, you should research art insurance to find a few options. There aren’t a ton of companies doing this because many artists forgo the extra expense. But a few popular names are Fractured Atlas, Brower Insurance, and the ACT Insurance Program from Veracity Insurance Solutions.
If you are insuring your studio space, either your separate workspace inside your home dedicated to your business or an outside studio space, you are protecting the building and everything inside it from things like fire or theft. Most of the time, your studio is fine. But if you were to have a fire, how much would you lose in finished pieces, materials, equipment and tools, and even the cleanup process?
It might be worth the expense.
If you ever have visitors in your studio space, then you should strongly consider liability insurance for the property. This is hugely important because you can be in a lot of financial and legal trouble if someone were to get hurt while in your studio.
Some laws may even require you to have liability insurance depending on where your studio is located.
If you teach out of your studio, you are almost certainly required to have liability insurance or to have your students sign contracts waiving your liability. (Definitely consult with a legal professional before using a contract. Your homemade contract may be missing key language that would ensure your protection.)
Liability insurance for your art is the least likely type of insurance for you to need. This insurance typically protects you from a customer getting sick or injured as a result of owning your art. So perhaps you used toxic paint or your customer had an allergic reaction to one of your materials. It’s very uncommon and if you state the materials at the time of purchase it would usually be considered the customer’s fault if something were to happen. But if you frequently work with materials that could cause problems, this is something to look into.
A last note for you if you think you’re covered – make sure you check your policies thoroughly.
Typically personal insurance policies like your homeowner’s insurance isn’t going to cover anything business-related. And most insurance policies do not cover floods so if your studio space is at risk of a flood and you keep art low to the ground, you may not be covered. Make sure you’re aware of what your insurance policies cover and if you’re concerned about something they don’t cover, consider getting extra insurance.
And don’t forget to save copies of what you can ahead of time, just in case. Backup your computer regularly and make sure you have high-quality digital images of all your work should the original be destroyed but you still want to make prints or license the artwork.