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Welcome to the Cake Decorators Q&A

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asked June 5th 2012

Working from home

Hi, I am just in the process of setting up my cake business and I have only done cakes for family and neighbours so far. Can anyone tell me does it affect your house insurance if you have customers collecting cakes from your home? Thanks!

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Hi, I am just in the process of setting up my cake business and I have only done cakes for family and neighbours so far. Can anyone tell me does it affect your house insurance if you have customers collecting cakes from your home? Thanks!

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Hi Doodlecake,

Yes it does affect your home insurance, more so if making cakes is your full time occupation.  You also need to inform your mortgage provider (some have specific rules about home bases businesses), check your title deeds (for the same reason) and inform your local council so that your food business is registered (they will carry out an inspection but they are far less scary than people will lead you to believe!).

There are lots of considerations for people coming to your home for business purposes, and heightened risks as far as the insurance company is concerned.  There are risks of liability – for example, someone could trip over a loose paving slab, burn themselves by touching appliances in your kitchen or otherwise hurt themselves in your home.  You wouldn’t think anyone would be so daft but a lady visiting my home to pick up a cake allowed her son to touch a hot radiator whilst I was getting her some business cards!  (Apparently, I should have warned her that the radiator, which is tucked away behind my kitchen, might be hot!).

There is a risk of theft if you invite people onto the premises (easy for people to pick things up when your attention is on the cake), this risk is heightened when people know you have a home based business (more customers = more people who know there could be cash on the premises).

The majority of your customers will be honest, friendly people, who are not daft enough to touch sharp and hot objects and can move about on their own two feet without incident or injury, so I wouldn’t worry too much about these things – an awareness is enough to mitigate the risks in most circumstances.

I would recommend being totally honest about the level of business with your home insurer.  It may not make much of a difference to your premiums.   It’s easier than ever for insurance companies to find out about how much business you are bringing in and if you indicate that it’s a ‘paid hobby’ rather than a business, you may find they don’t pay out in the event of an incident.

Sorry to post and run, I hope that’s helpful!

JC x

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I’ve never even thought about that..but I’m new to the business too.  We are now living in a society where people sue people at the drop of a hat and would suggest that if it was a very snowy or icy day to clear your pathway so no one can slip or loose paving stones so no one can trip..I know this from a friend who is a registered childminder..but this is just someone coming to your front door to collect something not entering your home  for more than 5 minutes. Maybe someone else will have a different answer??

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Thanks for the info, that’s really helpful. I’ve been on the food hygiene course and registered with the council and been inspected so that’s the scary stuff done! I’ve also got public and products liability so it’s just the house insurance/mortgage I need to sort out (and of course the tax man if anybody actually wants to buy my cakes)!