Home insurance with a hobby electronics lab (read this)

[Psi]

I just spend 2 hours on the phone to my insurance company because i wanted to clarify my contents insurance with regard to my home electronics lab and the test gear.

I also run a small business which made things more complex. Home policy's don't cover business gear.

Basically i wanted to get it on record that my electronics lab equipment was for hobby use (i fly RC planes) and not for business use.
And is therefor covered by the contents policy.

This is an important thing to do. The natural reaction of any insurance company to the word "oscilloscope" is "Business equipment"
And you don't want to be arguing this when you need to make a claim.

I was successfully able to get a verbal agreement with them that since it's for personal RC airplane hobby use its covered.
And I gave them a few pieces of test equipment as an example for their records.

I recommend you do this as well if you have lots of test gear and you may want to claim in a fire/theft etc..

Also a good idea to record the phone call like i did.
Since they are recording the call at their end there is no legal issue in me recording too.

[EEVblog]

Don't you just get a fixed contents cover amount?
Should matter what the contents is.

[Psi]

Business assets are not covered by a personal home insurance policy. Which is totally fine, that's what business insurance is for.

The issue is that insurance companies have a hard time believing a spectrum analyser is for personal home use.
To them it's in the 'business equipment' category.
Their computer system may not even allow them to enter the item on a personal claim form.

Basically it raises lots of red flags and makes it harder to process your claim.
Remember that insurance companies are always looking for ways to get out of paying.

You might be able to prove it to them at the time of a claim, but it's risky.
Especially if you run a home business but the lab equipment is owned by you.
Tools are very general and may get used for occasional business use.
So they can argue...  "That oscilloscope is clearly a business tool, not a personal item so it's not covered" and you are left trying to prove otherwise.

You basically end up trying to prove that you own the oscilloscope as your personal item but allow the business to hire it from time to time for no change.
Which, from their preservative, looks really really dodgy.

[PlainName]

but allow the business to hire it from time to time for no change

That, in itself, is a commercial arrangement. Look at it like a car: you own it but use it for business purposes now and then (perhaps getting to and from a client). Your normal car insurance won't cover that.

[CJay]

In addition to making clear the items you want covered are for hobby use, it's worth listing the contents of a home lab on the policy because insurance companies often have limits on how much they'll pay out on a single item and it can be surprisingly little, lower than the retail price of the R&S 'scope Dave is giving away for instance.

You obviously can't claim for something twice so in general terms business assets and personal assets would be covered under separate policies (no point covering it twice) but if you're a sole trader/non limited company then your 'business assets' are your personal property and it can get a bit blurred, again, speak to the insurance company, they can be surprisingly helpful. If they're not, then you're with the wrong company.

Car insurance for business purposes is a different matter, it's usually just a case of telling the insurance co, I have done it in the past, it added nothing to the cost for just business travel but if you want goods in transit insurance, open your wallet.

[hendorog]

I checked this a while ago and they told me business use was OK up to 20K contents for electronics.
Above that it needed to be a business policy. So YMMV I guess.

[Falcon69]

dunkemhigh is correct.

As much as I hate how insurance companies operate, you have to see it from their point of view as well.

I have a friend who uses his car to deliver newspapers in the am. He hit a deer in the early am while delivering. Like an idiot, when he called in the damage to his insurance company he told him he was delivering newspapers when he hit the deer. They told him they were not going to cover the damage because he was using the vehicle for business purposes and they were not notified the vehicle was being used for that purpose when coverage was purchased. At that time, they also dropped his coverage as well. He had to find new insurance and they also put a mark on his insurance record as an accident at fault., even though he didn't have a claim, just the fact it was reported was enough to put a mark on his 'insurance record'.

On one hand, Insurance Companies rip the people off so badly, but on the other hand, there are so many people who fraud the insurance companies everyday, and not just the people, I've seen the auto body shops doing it too!

[WastelandTek]

Remember that insurance companies are always looking for ways to get out of paying.

you don't say?

[Falcon69]

On another note, I recently got new car insurance, and with it renter's insurance, I remember seeing on the declarations page it asking me about declaring certain items...i remember seeing things like 'guns' 'jewelry' 'coin/gold collections' 'instruments', but I never saw any 'lab equipment' or 'tools' on there.

Would 'lab equipment' and/or 'tools' actually be considered as part of the 25k or 50k flat amount you stated as total belonging amount? seriously? I doubt if you had a 15k oscilloscope they would pay up for that with no questions asked if they are asking you to declare any guns or jewelry of value you may have.

But, I don't see it being a problem if you discuss it with the agent and get it in writing explaining it, that it is just for hobby use and including it into the policy, then it shouldn't come as a surprise later when something does happen.

[EEVblog]

For business I found no commercial insurance company that even had a clue what I did or would understand what I wanted covered, let alone have a category to put me into. So I got all these ridiculous quotes (they never refuse you, just up the prices when they don't understand).
Finally got broker friend to find someone who was willing to give an acceptable quote.
Then they found a new one this year and it was crazy cheap, like 1/8th the cost of the original quotes.

[vodka]

dunkemhigh is correct.

On one hand, Insurance Companies rip the people off so badly, but on the other hand, there are so many people who fraud the insurance companies everyday, and not just the people, I've seen the auto body shops doing it too!

That is true , but there are many insurance  corporation try to defraud to the people,blatantly. When i lived a flat , a neighbor had a leakage of the water on her bathroom. So the Neighborhood community(9 floors with 5 doors)  convoked a meeting among  the owners where talked with a insurance proficient of the community.  The rotter proficient said to neighbors and the president that the insurance didn't cover the leakage and each affected neighbor(9 owners)  would have to pay 1,000,000 ptas (6000$). My father know perfectly the "horizontal law" and  he reclaimed versus proficient.
He argumented that the trouble had produced on a "common zone" and  according the "horizontal law" , the insurance cover it .But the proficient would follow negating it, until that my father tired , he said him that he was disposed for going to the Court.  Automatically , the proficient turned and led to the president and said her very low : " The insurance cover it".  She stayed with the opened mouth.

[Neganur]

My home insurance company straight up refused to sell me an insurance after I handed them a list of my equipment with purchase date, used price, list price, serial numbers and photographs...

At first I got a lot of silly questions like what do I use this for, why do I need it, what exactly is it etc.
Then we were talking about the amount of insurance I wanted which was no problem at all, but when I handed him my list and he saw the list price of the gear the guy spent 30 minutes on the phone talking to his head office only to tell me that "sorry sir but we will not sell you an insurance".

It really pissed me off since it would be no problem if I had a super expensive home cinema system or 5 PCs or similar things that costs silly money. Just that the list price of an oscilloscope is above 20k new (I bought it used for 5k) an old Keysight spectrum analyzer has a list price of more than 100k (E4445 PSA) but they seem unable to grasp that you can buy this stuff used for much less ( I even made him browse Keysight's ebay website...).

I just want it insured so that I can buy equivalent used stuff in case of fire or whatever.

[CatalinaWOW]

Many of the folks selling this stuff on Ebay or elsewhere have no concept of the value, so how would you expect a non-specialist like the insurance company to understand value/replacement cost of our gear.  They are in the risk management business and lack of understanding translates into huge risk so they either back off or quote huge values.

To really understand the position - how would you evaluate the value/replacement cost of your lovingly restored piece of old Tek or HP gear.  The recapping, addition of heatsinks to vulnerable components, the replacement of flaky EEPROM and old lithium batteries.  Where do you point to a marketplace with an instrument of comparable value?

[Psi]

Thanks Neganur!  That's exactly my point.

My home insurance company straight up refused to sell me an insurance after I handed them a list of my equipment with purchase date, used price, list price, serial numbers and photographs...

Yep, and not all policy's require you to give them a list. Some only require it for items over $3k.
You can have a nice lab setup with 50 pieces of test gear where all of it is under the limit.
So you can have insurance and think you're covered (and you should be), but if they knew about your lab they wouldnt have covered you.  It's a bad place to be in at claim time.

At first I got a lot of silly questions like what do I use this for, why do I need it, what exactly is it etc.
Then we were talking about the amount of insurance I wanted which was no problem at all, but when I handed him my list and he saw the list price of the gear the guy spent 30 minutes on the phone talking to his head office only to tell me that "sorry sir but we will not sell you an insurance".

It really pissed me off since it would be no problem if I had a super expensive home cinema system or 5 PCs or similar things that costs silly money. Just that the list price of an oscilloscope is above 20k new (I bought it used for 5k) an old Keysight spectrum analyzer has a list price of more than 100k (E4445 PSA) but they seem unable to grasp that you can buy this stuff used for much less ( I even made him browse Keysight's ebay website...).

I just want it insured so that I can buy equivalent used stuff in case of fire or whatever.

They don't expect a normal home to have a lab full of test equipment for hobby use, so they don't ask if you have it.

The usual rule for personal items should legally apply, if it's for personal use then it should be covered. "hobby" is personal use.
However they will not see it this way at claim time. They will see it as an opportunity to get out of paying because it seems like business equipment and if you say it's not for business they will think you're lying.

But if you have a recorded phone call where you told them in clear English about the situation then you are in a MUCH better position.
 

[trophosphere]

I wonder if you can pass it off as home entertainment and you are just one of those people who has a home theater system and is an audiophile. My function generator is a digital music player and my oscilloscope is an audio spectrum visualizer. 

A projector can be 10,000 USD.

[Halcyon]

For what it's worth, my home and contents insurer (which is backed by one of largest insurers in Australia, AAI Limited) is pretty open about what they will (and will not cover) and the law states that each one has to have a Product Disclosure Statement which clearly outlines everything in plain English.

Their policy won't cover loss or damage to any part of your home used for any business activity or loss or damage to contents kept in this area, except where the business activity is using part of your home as a home office.

and "contents" does not include stock for a past, present or future business activity.

In addition, I can choose to list specific items on the policy at no extra cost, which means those items would them form part of the contract for insurance coverage (however, they would still be covered without listing them on the policy). Equipment worth more than $2000 and are "mobile" (laptops, projectors etc...) would generally be listed.

As long as you can prove that you weren't using the items for the purpose of conducting a business, then no matter what the item is, it's covered (with some exceptions which don't apply to the scope of this thread).

[Galenbo]

In my country, with my private insurance, what you pay is based on the value of the house, expecting a "normal" content.
So after a fire, bigger chance to get 30K equipment accepted in a big house than a small one, because there could have been 30K in clothers, or an aquarium of that price.
Everything "not normal" can be declared preventive, which rises the wage.

[eugenenine]

The usual rule for personal items should legally apply, if it's for personal use then it should be covered. "hobby" is personal use.

A crappy company will insure your hobby tools but then when its time for a claim they will say you "could" use them for business and refuse to cover them.  Allstate screwed me that way.