Whether you make soaps, bath bombs, body scrubs, bath salts, moisturisers or any other type of cosmetic product, you may want to consider taking out some insurance cover.
Taking out insurance for a soap making business in the UK can give you financial cover in the event of a compensation claim made by a customer.
It’s relatively easy to do and it ensures you have peace of mind that your business has the right level of protection.
In this article we discuss if you need insurance as a soap making business, how it could help you and what types of policies to look out for.
Do I need insurance for a soap making business in the UK?
Whilst it is not a legal requirement for you to have insurance to sell soap online, it does make good business sense to have some financial protection in place.
This is also true if you intend to sell your soap products at a craft fair or event.
However, the event host may require you to have a specific type of insurance policy in place as part of their terms and conditions before allowing you to attend.
Why should I take out insurance for soap making?
Any business selling products to customers should ideally have insurance in place to protect them from claims made by members of the public.
Even if you have a faultless product with the perfect formulation, there is always the chance that a claim could be raised against your business that is related to the goods you have sold.
Insurance can not only give you cover for any potential issues related to the formulation of your products.
It can also offer protection for any claims made about the labelling and for issues related to the manufacturing and packaging.
In certain circumstances you may also be able to use insurance to replace damaged products (if your products are affected by a natural event, for example) or if you use a white label or private label service, it could help to spread liability.
Do I need insurance for soap making even if I do not sell my products?
If you are making soap and simply giving it away to friends and family as gifts, you may still want to consider having some insurance in place.
As an example, you may give a few bars of soap to a family member who is a big fan of your soapmaking.
After speaking with a work colleague about how great your products are, they could give that person a bar of your soap – only for the work colleague to have a bad allergic reaction.
Depending on the severity and potential financial cost to resolve it, they could try to raise a legal claim against you, in the expectation that you will provide some kind of compensation.
What type of soap making business insurance do I need?
Insurance for a soap making business in the UK usually falls into two categories. Most insurers provide these separately or as combined policy:
Public liability insurance
This type of insurance gives you protection against compensation claims that are raised due to harm or injury caused by your products or services.
This includes loss of, or damage to, third party property and death and disablement of the public.
In certain circumstances, the costs related to these claims can be quite high (including legal costs) and could create quite a large financial burden.
Product liability insurance
If you take out product liability insurance, this can provide financial cover for products in production, supply and sale.
Should you experience an issue as a direct result of your product processes and/or packaging, this policy can provide cover for any related personal or legal costs that are incurred as a result.
How much does soap making business insurance cost?
There is no fixed price for soap making business insurance, as each provider formulates their prices in a different way.
They will also have to consider factors such as the:
- Type of products you make and sell
- Ingredients and equipment you use to make your products
- Size and location of your business
- Amount of cover you want for your business
- Excess costs
Once you provide these details (some insurers may require additional information) you will receive a quote.
It is a good idea to get three quotes from different insurance providers so you can assess which one offers the best value for your business.
Taking out soap making business insurance may seem a little scary as it makes things a bit more serious.
But the important thing to remember is that it can give you better financial protection so you aren’t left to deal with an expensive compensation claim and associated legal costs should there be an issue with your product.
Public and product liability insurance policies are easy to find as all major providers offer them, so take your time shopping around and be sure to compare the features and benefits before committing.