Selling online used Electronics - which insurance needed ?

[Deleted User]

Does anyone know as a business what type of insurance ( if any ) I need to sell used electrical items online ?

I have  looked online and before signing up for a policy want to make sure it is the right one . I normally sell as a business online through Ebay mostly music memorabilia but have been looking to selling   used hi fi gear and amps. 

I have phoned a few places and the prices are around £300 a year , they do ask if the items are electrical or electronic I said both , the issue is that they are used  which they said limits my options. I have a friend who can do the PAT testing for me.

I was told that on the phone that it would have to be product liability  but is not offered as a stand alone product. 

XRS200

Public and products liability insurance come as a package.  Doubt you will get products liability insurance on its own

DullGreyGuy

[Deleted User] said:

Does anyone know as a business what type of insurance ( if any ) I need to sell used electrical items online ?

I have  looked online and before signing up for a policy want to make sure it is the right one . I normally sell as a business online through Ebay mostly music memorabilia but have been looking to selling   used hi fi gear and amps. 

I have phoned a few places and the prices are around £300 a year , they do ask if the items are electrical or electronic I said both , the issue is that they are used  which they said limits my options. I have a friend who can do the PAT testing for me.

I was told that on the phone that it would have to be product liability  but is not offered as a stand alone product. 

What risks are you wanting to cover? 

Where are the goods stored before sending?

Product Liability - is for those manufacturing, designing, altering, putting their name to products that cause injury or damages. it can sometimes come on the supplier if the manufacturer cannot be identified

Public Liability - covers damage and injury caused by you or your business

In the SME world when you buy Public it will be packaged with Product inside it. 

Professional Indemnity - covers you if you are giving advice to people and that advice is wrong, probably not necessary in your case as its likely you'd just accept the goods back if you wrong advised they'd work with their other kit.

Stock - if you are holding a notable amount of items, covers your standard fire/theft perils etc

Property - if you've got a place and are responsible for its insurance

Employers Liability - if you have anyone thats helping you that isn't immediate family as employee, volunteer or labour only contractor



I ask where the goods are being stored before being sold as if it's your home you need to ensure your Home insurers know you are storing goods for your business at home, most won't like it. https://www.financial-ombudsman.org.uk/decision/DRN-2631497.pdf This is a £85k of losses that weren't covered after the insured failed to mention their business activities at home, did see a mid 3 figure case years back when a house was gutted with fire and they were using the spare bedroom to keep products for their hairdressing salon.

[Deleted User]

DullGreyGuy said:

[Deleted User] said:

Does anyone know as a business what type of insurance ( if any ) I need to sell used electrical items online ?

I have  looked online and before signing up for a policy want to make sure it is the right one . I normally sell as a business online through Ebay mostly music memorabilia but have been looking to selling   used hi fi gear and amps. 

I have phoned a few places and the prices are around £300 a year , they do ask if the items are electrical or electronic I said both , the issue is that they are used  which they said limits my options. I have a friend who can do the PAT testing for me.

I was told that on the phone that it would have to be product liability  but is not offered as a stand alone product. 

What risks are you wanting to cover? 

Where are the goods stored before sending?

Product Liability - is for those manufacturing, designing, altering, putting their name to products that cause injury or damages. it can sometimes come on the supplier if the manufacturer cannot be identified

Public Liability - covers damage and injury caused by you or your business

In the SME world when you buy Public it will be packaged with Product inside it. 

Professional Indemnity - covers you if you are giving advice to people and that advice is wrong, probably not necessary in your case as its likely you'd just accept the goods back if you wrong advised they'd work with their other kit.

Stock - if you are holding a notable amount of items, covers your standard fire/theft perils etc

Property - if you've got a place and are responsible for its insurance

Employers Liability - if you have anyone thats helping you that isn't immediate family as employee, volunteer or labour only contractor



I ask where the goods are being stored before being sold as if it's your home you need to ensure your Home insurers know you are storing goods for your business at home, most won't like it. https://www.financial-ombudsman.org.uk/decision/DRN-2631497.pdf This is a £85k of losses that weren't covered after the insured failed to mention their business activities at home, did see a mid 3 figure case years back when a house was gutted with fire and they were using the spare bedroom to keep products for their hairdressing salon.

hi thanks for the information ... I have informed my house insurance about holding the stock .. 

When I phoned a couple of brokeers ./ insurers  they said it was product liability which was needed when selling used electrical item , is this incorrect ? 

XRS200

Its wise to have products liability insurance if you are selling anything

DullGreyGuy

[Deleted User] said:

DullGreyGuy said:

[Deleted User] said:

Does anyone know as a business what type of insurance ( if any ) I need to sell used electrical items online ?

I have  looked online and before signing up for a policy want to make sure it is the right one . I normally sell as a business online through Ebay mostly music memorabilia but have been looking to selling   used hi fi gear and amps. 

I have phoned a few places and the prices are around £300 a year , they do ask if the items are electrical or electronic I said both , the issue is that they are used  which they said limits my options. I have a friend who can do the PAT testing for me.

I was told that on the phone that it would have to be product liability  but is not offered as a stand alone product. 

What risks are you wanting to cover? 

Where are the goods stored before sending?

Product Liability - is for those manufacturing, designing, altering, putting their name to products that cause injury or damages. it can sometimes come on the supplier if the manufacturer cannot be identified

Public Liability - covers damage and injury caused by you or your business

In the SME world when you buy Public it will be packaged with Product inside it. 

Professional Indemnity - covers you if you are giving advice to people and that advice is wrong, probably not necessary in your case as its likely you'd just accept the goods back if you wrong advised they'd work with their other kit.

Stock - if you are holding a notable amount of items, covers your standard fire/theft perils etc

Property - if you've got a place and are responsible for its insurance

Employers Liability - if you have anyone thats helping you that isn't immediate family as employee, volunteer or labour only contractor



I ask where the goods are being stored before being sold as if it's your home you need to ensure your Home insurers know you are storing goods for your business at home, most won't like it. https://www.financial-ombudsman.org.uk/decision/DRN-2631497.pdf This is a £85k of losses that weren't covered after the insured failed to mention their business activities at home, did see a mid 3 figure case years back when a house was gutted with fire and they were using the spare bedroom to keep products for their hairdressing salon.

hi thanks for the information ... I have informed my house insurance about holding the stock .. 

When I phoned a couple of brokeers ./ insurers  they said it was product liability which was needed when selling used electrical item , is this incorrect ? 

There is no legal requirement to hold insurance to sell used electrical items but it would be sensible to hold it, as previously mentioned at what I assume your level of trading is (not making millions in profit) you would be Public Liability inc Product Liability and kill two birds with one stone. 

Insurance is a risk transfer mechanism, if you're happy carrying the risk you dont buy any insurance. If you want to reduce is significantly but happy to retain a little risk you buy a policy with an excess at the level of the risk you want to retain and pay a lower premium. If you want as little risk as possible you buy insurance with no excess but the premiums will be notably higher. 

[Deleted User]

Thanks for the comments , just had the qoute back and paying 24% in admin fees for the broker . Is this standard , do I get more backup going through the broker ?

DullGreyGuy

[Deleted User] said:

Thanks for the comments , just had the qoute back and paying 24% in admin fees for the broker . Is this standard , do I get more backup going through the broker ?

Brokerage in commercial insurance is very wide ranging and can be complicated by the existence of wholesale brokers and MGAs in the supply chain. 

Transaction brokers, ie when the buyer and the insurer have already done all the work but because its Lloyds of London there has to be a broker will typically charge around 5% on a 6 figure premium. At the other extreme have seen 50% brokerages on a 8 figure premium for a fine art policy including transit for a state art collection but then the brokers dealing with circa 150 different insurance companies on the policy and who knows how many others they talk to to get the 150 to sign up, plus validating the value of both the pieces owned plus the pieces to be lent


Ultimately if you are happy with the cover and the price does it really matter how the pie is shared? I buy from a broker thats selling for an MGA. The broker is on circa 22% and tries to charge a £50 admin fee which they waive each year. The MGA charges a £50 admin fee which they won't waive and presumably both a commission and a potentially a profit share, assuming the business they write is profitable. The cost of selling insurance is expensive with a lot of time spent with potential customers who end up not buying from you. If you dont have a broker then the direct insurer incurs those costs but they just dont have to declare what proportion of the premium is marketing and what proportion is risk coverage. 


Brokers give advice, no direct insurer does advised sales. Just because they can give advice doesn't mean their advice is always good. Have dealt with some poor quality brokers but I'm a hard risk to place because of the nature of my work, the scale of my work and the fact many insures have been my clients and so they have a conflict of interests. 

In principle a decent broker will also help you present your claim to the insurer but here too they can become conflicted because insurers monitor the profitability of business from their brokers even if there isn't a profit share