What about insurance? Do I need it?
by Gary Cole

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One of the most common questions to the face painter's discussion list is "what about insurance and do I really need it?" If you ask several professional face painters you are like to get several answers. Some of these will have very strong opinions from "I would never accept a face painting job with out first signing up for insurance" to "it is all a scam, put your money back in your pocket". There are other face painters where one of the conditions of getting a booking is first to show proof of insurance coverage. While we are not going to tell you specifically what you should or should not do, we will give you some information that can certainly help you in making that decision. In addition, we will give you some contacts on where you might obtain insurance for face painters. We are willing to add other potential insurance sources that cover face painters. This is by no means an endorsement of these insurance companies and you should thoroughly check these out before you buy.

The first question  is why does one even buy insurance? We buy life, home, health, fire, theft, dental and even disability insurance. We are basically placing monetary "bets" against something happening aren't we? Each of us we have different odds on a pay off of insurance benefits. The funny part is we really do not want the insurance company to be called upon. We hope that the "bad thing" does not happen requiring the payment of insurance funds. Often we pay a premium each month and make claims against the health policy as needed. We do this knowing up front that we will always be paying out more in premiums that we receive in claims paid. These claims are paid for by the insurance company. We even allow the insurance company to collect above and beyond these claims just in case of high unexpected claims like complications in surgery or cancer or other long term illnesses that can be very expensive. We want the comfort to know those funds would be available should we need them. We will add that some insurance, like auto insurance, is required by law. You will find that some events also require insurance if you want to participate in that event. Each type of insurance company has different relative insurance risks or odds. With these odds we are expected to pay higher premiums depending on the risk we are to that particular insurance carrier. Keep in mind ALL insurance companies are in the business to make money. This is no difference to your local McDonald's franchise or Microsoft Corporation. They must collect in premiums AT LEAST slightly more, than they pay out in overhead and in claims. If I had previously been diagnosed with cancer, or heart problems, it is expected that I would have to pay higher premiums than someone who has never been in the hospital. Likewise a healthy, athletic 20 year old male would be paying less premiums than someone that is 85 years old and in ill health. It boils down to actuary tables and assumed risk. These insurance companies have it down to a science. So you need your decision to include questions like "what are my risk factors?" and "what is the likelihood that a claim will be made against me?" Ask yourself what are the pros and cons to insurance? Be very objective.

The second question is, cost versus benefit? Is it worth it? If you are going to pay $35 per month are you going to receive $35 per month in value? What are the odds that you ever will make a claim and if you make a claim will you get the claim paid? Or if you pay $35 per month is that going to give you a $35 per month of piece of mind against a possible law suit? It really is a simple question. Do you think you will get your $35 worth? If the answer is yes, then sign on the dotted line and send in your check. You might re-ask this question after paying premiums for one year or two because the answer might change. Also if you had to make a claim how well did the insurance company handle your problem?

When you are considering insurance you might ask yourself, what exactly am I going to get out of the deal? For example, what are the possible things that you might do as a face painter that put you at risk? What is the possibly the worst thing that could happen to you? Are they realistic and what are the chances that your insurance company will come through and fix the problem? Some things you might consider...

1) What are your work habits including products, cleanliness, staffing and organization skills?
2) An allergic reaction? see www.rubyredpaint.com/safety.htm
3) Poke a child in the eye with a brush
4) Your table, chair or other equipment cause injury to a child or to personal property
5) Mixing your products with unsafe materials
6) Use contaminated water
7) Cross contaminate children
8) Be in an unsafe work area
9) Sexual harassment claims
10) Physical abuse claims
11) You might even spread a virus or disease via face painting one child after the next with the same sponge.

Keep in mind that the world is getting more and more lawyers everyday. Does this put you at risk even if the claim is invalid?

The question is, if you have insurance does that mean that you simply turn over "the problem" to your insurance company and it goes away? Is that piece of paper that you pay $35 per month (or whatever it is) going to give you the support you think it will? When was the last time you made a claim against your own current insurance policies and were your claims handled as smoothly as you expected? Are you working for a repatable insurance company? All insurance companies are not the same. Like in all financial decisions, buyer beware. Make sure you look around and check out for the best coverage for the money. If it sounds to good to be true, it probably is. Ask them if they have had to pay a claim and how it was handled. If you can pick up one policy for $5 per month and there is another policy for $150 per moth there is a reason for it. Find out why. One painter might be perfectly comfortable with the $5 policy and another think that the $150 policy is the best value because of what is covered. As a face painter I would first ask your peers what they do or ask them for advice.

If you have an insurance company how do you make a claim? How fast do they act?

These are questions you might ask when considering insurance... ask your potential agent.

1) What are the costs?
2) Do they specifically cover face painters or all of the other services you offer?
3) What percentage of their insurance covers face painters?
4) What is covered by the policy?
5) What is not covered by the policy?
6) How do I make insurance claims?
7) If there is a claim can I divert the person with the problem directly to the insurance company?
8) Is there a limit to the payout on the claim?
9) Is there a deductible that would need to be paid first?
10) Is there a fee per claim?
11) Under what conditions could the policy be cancelled?
12) Is it an automatically renewed policy?
13) Specifically, what face painting claims have been made in the last 3 years and how were they handled?
14) Would the insurance company pay attorney fee if required?
15) If "the problem" was due to negligence by yourself is the insurance still in effect?
16) Are they endorsed by an agency, group or organization?
17) Do the rates go up or down depending on how many claims you might make?
18) How many claims did they pay out in the last 3 years and what were they for?
19) When was the last price increase and what was it?
20) What type of document does the insurance company give you? Does it SPECIFICALLY state what is and is not covered?
21) Some of your customers require that they be added as "additional insured". Does this policy allow this and how much does it cost per incident? Is this also put into writing?
22) Is the policy pro-rated?
23) Does it cover other claims like fire, theft, health or bodily injury?
24) Does it cover you personally if there is an accident and you are injured?
25) If my customer needs an "additional insured" added to the policy is there a fee associated with this?

The bottom line you need to ask yourself is, for the money you pay out, are you going to get your money's worth in terms of coverage, payout or piece of mind? Everyone you ask will have a different opinion and many of them will be quite vocal.

Also keep in mind corporate accounts or festival may REQUIRE insurance. If this is true then you simply have to ask yourself the question am I going to make enough money to justify the additional costs of insurance. For eleven years I went without insurance as I simply did not think the costs were worth the benefit. In 2006 I decided to do a large festival that required it. I looked at the several hundred dollars it would cost me.  I felt I would easily make the money back at the festival so I signed up. To me, it looked like a win/win. In my personal case, I started to target more and more corporate accounts as well as look to pick up some major festivals. Many of these require proof of insurance and to be able to get the job you must have the insurance. I pay a little over $200 a year with Specialty Insurance and it gets me many thousands of dollars in corporate and festival work. I figure it is money well spent. I've never had a single claim so I suppose it is still worth my money. I see it as a business expense just like fuel driving to the event. To many, they see it as security. You choose for yourself.

I would add that just because you have insurance it does not mean the insurance will cover you. My guess would be if something happened because of neglect you would be on your own.

Here are some potential insurance companies you might contact that we know are in this industry. The listing of these names by no means is an endorsement. You must check them out yourself and make the best decision for you and your company. We are willing to add other agencies to this list if they specifically can cover face painters. What insurance company do you use and are you happy with the results? If you use an agency that is on the list please tell them you learned about them on the face painters discussion list.

www.clownsoftheus.com  They have both a individual entertainers policy as well as a vendors policy (for high volume festivals)

Al Fellerman Insurance
Clowns of the U.S.
7732 Cayenne Plaza West
Woodbury, MN 55125
phone: 651-738-0280  fax: 651-501-2988   e-mail: ClownsOfTheUS@msn.com.
link http://www.clownsoftheus.com

Hampson Mower Kreitz Agency
phone: 610-868-8507   fax: 610-868-7604  e-mail: tgoldsmith@hmk-ins.com

World Clown Association (you must be a member of WCA to get this insurance)
http://www.worldclownassociation.com/insurance.htm
insurance@worldclownassociation.com

Again, if you contact one of these agencies please tell them that you were referred to them by the face painter's discussion list.

Product liability insurance...

There is a difference between the insurance we discussed above and product liability insurance. Most reputable manufacturing companies that supply face paints carry product liability insurance. If they don't then you shouldn't touch their product with a ten foot pole. What product liability insurance covers is IF THAT PRODUCT had any harmful affect on an individual, when used properly, then they would help you address the problems. It WOULD NOT cover anything from a scenario like you poking a child in the eye with a brush to if you used the paint in combination with lets say, toxic water. You should check specifically your your particular product supplier. Ruby Red Paints Inc. carries a $2,000,000 product liability policy in the USA and even more in the UK. If you have a product concern you should contact them directly. Please read the link www.rubyredpaint.com/safety.htm  This talks about it much more. BE ADVISED that all of these companies product liability is limited to ONLY their own brand of make-up. If you use their make-up in combination with another brand of make-up you void the product liability of both companies. A manufacture can assure you that their products are safe for use in combination with their own products. There is no way they can guarantee that their make-up is compatible with every brand in the world. There are simply to many factors involved. This is why we say over and over to check out the different brands and choose ONE that you like the best. Then only use that one brand. All manufacturers will say the same. Be sure to check with your specific brand to see what is and what is not covered. As far as Ruby Red Paints, we will back you up if you are only using our brand. Any product related issue can be deferred directly to the manufacturer. They know how to work through any concerns. You will be happy to know in the history of Ruby Red Paints there has not been a single claim made to the insurance company. We go out of our way to ensure the safety aspects of our products. I have had multiple calls about other brands and if you check out on Facebook or the face painting blogs you will see allergic reactions reported monthly. The highest incidents of allergic reaction is with the face paints that are manufactured in China.

Gary Cole
gary@rubyredpaint.com  

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