What is product liability insurance and why might I need it when sourcing sustainable materials?

Posted 02/11/2023 in Insurance

It’s fun to wonder what might be a crafter’s idea of an Aladdin’s cave. Might it be a treasure trove of glittery gems, colourful beads, sparkling silver wire, clasps and studs? Or could it be a neatly ordered room with every colour and texture of yarn you can imagine, organised by hue and tone in ceiling-high, fully stuffed box shelves? Or maybe a gorgeously fragranced room of essential oils, dried herbs and other botanicals, lye, bowls, spatulas and thermometers; all you would need to develop the most enticing range of handmade soap? Or possibly it could be floor-to-ceiling rolls of fabric, with plenty of overflowing baskets of tempting offcuts through which to rummage? 

What might your crafter’s Aladdin’s cave look like? It’s fun to imagine, and while your dreams may not become a reality, there might be some reflection of them in real life, in the very tangible Scrap Stores located around our nation. These amazing stores, filled to bursting with salvaged surplus from local industry or business can be located throughout our towns, cities and countryside. They generally run under one or two business models. The first one, a charity called Children’s Scrap Store is open to schools, youth or children’s groups, churches or other social organisations. For a small fee, a membership card is issued and then donations given for the materials collected on each visit. Membership is often extended to commercial crafters. The second model is a social enterprise model, by which the scrap store is opened to anyone and profit ploughed back into local social projects. Clothes and furniture may be collected for distribution alongside the scrap store materials, workshops, training and children’s holiday clubs may be held on the premises. Funds might be raised through initiatives such as children’s parties. Either of these models offer opportunities for crafters.

Scrap stores exhibited recycling before the main population had begun to think in this way.

By collecting clean and safe waste products from local business and industries, they are both reducing landfill and lowering carbon emissions by minimising the need for incineration. The stores have a constant flow of scrap material, and part of the fun of visiting one is that it is a bit of a lottery as to what you will find. You may go with a mental shopping list and come away with none of what you were looking for but a couple of bagfuls of quirky materials full of creative potential. They are thus a wonderful and exciting source of sustainable materials.

Here at Craft Insurers we often champion our clients’ ability to source environmentally sustainable and ethically sourced raw products. If you are able to do this, it is well worth flying your ethical credentials on your promotion and marketing media.  Customers are increasingly looking for goods made with sustainable products and will pay a premium for them; scrap store finds certainly fulfil this criteria.

Imagine now you have created some unique and beautiful products using sustainable materials, maybe from a scrap store, and are ready to release them to a band of delighted customers. It is sometimes at this stage that crafters think about insurance, and in particular product liability insurance. Is this something you will need, even if your goods are of a high standard and made with sustainable materials? The answer is, that while product liability insurance is not a legal requirement, it is highly advisable. If you are selling in any real-life setting, such as a market, fair or small shop, the organiser or owner may well ask for it.

So, what is it and why is it a good idea to have it? Basically, product liability insurance covers you against any claim a customer may make against your product even when it is not your fault. It covers your legal defence and costs, and any compensation that may be demanded. It is often hard to imagine what might go wrong with your product and thus lead to a situation like this. However, the whole point of both public and product liability insurance is that it offers protection against those incidents you cannot possibly foresee and thus cannot possibly prevent. This is why we call it a sleep easy insurance. Once in place, you can put all your creativity and energy into creating the best possible products for your appreciative customers.

Would you need it for online selling? The answer again is that while it is not essential, it is a wise precaution. There could be an argument that it is even more advisable if selling online. Relationship with our customers is so important and while you will do all you can to give your customers a good buying experience online, it will not be the same as a smile and chat when selling face to face. If there were a problem with one of your products, it could be argued that a customer who has met you, maybe heard a bit of your story and seen both your passion and hard work, would be less likely to file a legal complaint and more inclined to resolve the issue directly with yourself. Either way, product liability insurance will have you covered and put your mind at rest. Pick up the phone or drop us an email and either Naomi or Sam will get back to you and guide you through the best, most cost-effective cover for your unique business.

As we look towards Christmas, increasing numbers of consumers are not happy with the excessive commercialism around this time and the waste, landfill and general damage to both our beautiful world and our squeezed bank accounts. This is an excellent opportunity for small, local crafters to take centre stage, emphasising your sustainable credentials and lasting value of your products. Time to go and gather together an Aladdin’s cave of sustainable raw materials and get creating!