Karaoke insurance – what kind and at what cost

Whenever you budget the expenses of your business, Karaoke insurance must be included in the list because you can’t always know exactly what is going to happen in the future.

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With the protection provided by insurance against accidents and all the other kinds of insurance we will tell you about, you can protect your business and yourself in case something unexpected happens.

Like any business owner, for your Karaoke enterprise, you must consider how much financial liability you are taking on.

If your Karaoke business runs without proper insurance, you are taking an enormous chance not just of losing some money but of a final wipe-out.

This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the upshots of their actions. 

Karaoke Insurance

In this article, we are giving very general guidelines for startup businesses to highlight what the main kinds of insurance that you need are, and where available, a rough guide to how much you can expect to pay.

The question is, can you afford to NOT have insurance for your Karaoke business?

What this means, for any Karaoke business owner, is that if some customer claims that your actions caused them some physical or economic damage, a court can award damages far beyond the total size of your business.

Your Karaoke business is not sheltered by laws in the same way as states are, where laws can place a “cap” on the maximum level of liability.

In some states, like New Jersey, there are specific monetary levels that limit the amount a court can award in any case against the state.

In a court case, it’s purely the privilege of the jury to award whatever amount they deem appropriate, even sometimes giving a person more than they have claimed.

When you are running your Karaoke operations, you can’t deny responsibility for the outcomes of your actions.

Even more importantly, unless you have spent in advance the money necessary to have your business running as a limited liability company, all of that liability belongs to you as a person.

What does Karaoke insurance protect you from?

For your Karaoke business, the most important types of insurance are meant to cover the risks to your business from accidents, from unexpected events, and from mistakes.

In addition there are some legal kinds of insurance that various states require.

In the next few paragraphs, we will explain the most important points any Karaoke business owner should know when negotiating the insurance needed.

The main types of insurance for your Karaoke businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.

Liability insurance

General liability insurance

Any Karaoke business is dealing directly with other people, and that means you always have the danger that some accident can happen to them bodily or else something of theirs can be spoiled.

In such a case, they can demand compensation.

General liability insurance policy for your Karaoke business insures you against claims coming from injury to customers or damage to their property.

It protects your Karaoke business from the claims themselves and also to any follow-on court costs and legal fees of the lawsuits.

In many cases, it should help you to qualify for extra business from city and state organizations, where contracts require proper liability insurance.

The usual level of general liability insurance for your Karaoke business would be with a boundary of $1 million for a single submission and a total of $2 million for the whole year.

See the table in the costing section below for average prices of general liability insurance for your Karaoke insurance operations.

Professional liability insurance for your Karaoke business

In the event where a customer alleges some negligence, errors, or omissions in how you conducted your Karaoke business for them, you can quickly face a court case.

Even if the matter against you is decided in your favor, the cost of defense can be substantial, and the impact on your reputation can be damaging.

Every small Karaoke business should have enough professional liability insurance to cover an individual claim of $25,000, with annual cover of $50,000.

See the table in the cost of Karaoke insurance section below for average prices of professional liability insurance for your Karaoke operations.

Product liability insurance

Whatever goods you sell or advice you give about the goods, you are running a risk that customers may claim that what you delivered didn’t meet your description of function, or that your guidance was basically incorrect.

You need to understand the explicit laws of product liability in your own state.

For example, in California, all businesses in the supply chain can be held responsible for injuries caused by products claimed to be defective.

To cover yourself against any possible lawsuit, you need Product liability insurance for Karaoke

Only you can know exactly how much insurance you need.

Best advice is to consult with experienced insurance agents, brokers or company representatives for help.

Commercial insurance

Commercial vehicle insurance for your Karaoke business

Take care! – most policies for private vehicle insurance do not cover any event like theft or accidental damage when the van is being used for business purposes.

The proper way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a direct commercial vehicle insurance package.

Commercial van policies cover the value of any vehicle in case of accident, malicious damage, fire, or theft.

In addition, in case of any accident, the car itself, the content and any legal bills, medical expenses, and property damage is insured if your truck is involved in a collision.

Most states, other than Virginia and New Hampshire, insist on this type of insurance.

The necessary value of the insurance depends on the depreciated value of the vehicle, and your declared level of cover of contents. 

Tools and Equipment insurance

Since your Karaoke business needs specialized and dedicated equipment, you can appreciate how much it can cost to replace it in case of any damage, loss, or theft.

The tools may be subject to malicious damage, deliberate fire, theft, other such unpredicted acts.

Also, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can eliminate your whole business in one stroke.

Unless you can afford to immediately replace such specialized gear quickly out of your own pocket, you must have full-level equipment insurance so that you can immediately buy any equipment needed to keep your Karaoke business running.

It is impossible to advise how much equipment insurance you need – it’s basically dependent on how much you have invested in your Karaoke business’ equipment.

Commercial Property insurance

Any Karaoke business that owns or rents space in a building must have a commercial property insurance policy.

If you own the space, you probably have a substantial capital investment, as well as a big liability if there’s a mortgage.

Every physical building location should carry insurance coverage for the value of the premises and contents against natural occurrences like fire and storms, and against man-made damages like theft and vandalism.

If your Karaoke business deals in areas of high risk, like Texas or Georgia, additional coverage may be needed for earthquakes and hurricanes or tornadoes.

In other states like Washington, where unlimited cold snaps can cause damage to outer coverings of Karaoke business premises, there is a need for more supplementary cover than in warmer climes.

Although the level of cover depends entirely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of Karaoke insurance section below to give some idea of the average prices per million dollars of property insurance for your Karaoke business.

Temporary insurance by month, week or day for your Karaoke business

Is your Karaoke business working part-time or casually, or is the level of business seasonal?

Using short-term insurance makes perfect sense. Business insurance by the month, day, or week – temporary insurance for Karaoke – are special policies where you can cover a nominated period when you want to be covered.

By only paying for that period of cover, you will save by having less premiums but still having adequate risk cover.

The essential feature of short-term insurance is that you purchase the cover for a defined period – a designated date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.

When you are expecting periods of larger business activity, get the existing cover increased.

Talk to your insurance agent, broker or the company’s representatives to see what options you have.

Business Owners Policy BOP for your Karaoke business

You have the chance to combine a few of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.

A BOP combines commercial property and public liability insurance by amalgamating these coverages into one insurance policy, which can save you money.

BOP insurance will cover you if any claims of injury or property damage are made.

It is mostly the right choice for small and medium-sized Karaoke businesses, such as yours.

There are two limits that will dictate whether BOP is suitable for your own business.

BOPs do not cover your professional liability or commercial vehicle cover.

Also, the size of your business will rule whether you are permitted to take out BOP cover.

The usual business that can take out a BOP policy must have less than one hundred employees, and not more than five million dollars in annual revenue.

As well, you must separately take out the mandated worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your Karaoke business employees

In many states, it is mandatory to have workers compensation insurance when your Karaoke business has one or more employees.

Workers compensation insurance covers the operation against any costs that arise if an employee experiences an injury or becomes sick as a result of work.

The benefits cover medical expenses, death benefits, lost wages, and vocational rehabilitation.

Failure to meet a state’s laws in this regard can leave you as the employer required to pay penalties levied by the states.

Some states, such as North Dakota, Ohio, Washington, West Virginia, and Wyoming only permit coverage from the government-run monopoly state funds.

In these states, you can’t obtain your workers compensation obligations from private insurance providers.

Workers compensation rates are computed based on the employee’s pay, and usually come out at around $1.00 per $100 per month.

However, you must see the relevant authorities in your state.

Average costs of these types of insurance

Although every Karaoke insurance need is unique, there are enough examples of standard quotes from insurance companies for us to give approximate guidelines, including what are the cheapest rates offered.

Of course, you should always check with an insurance representative what’s relevant for your business.

The list below is of annual premiums we have researched for the main types of insurance your Karaoke businesses needs.

Types of insurance Price range
Commercial vehicle insurance $1974 – $2726
Equipment insurance $306 – $1016
Product liability insurance $347 – $738
Public liability insurance $305 – $560
Commercial insurance $844 – $2029
General liability insurance $720 – $1173

Cost of insurance for your Karaoke operations depends on many different factors.

We have calculated these figures for small independent Karaoke businesses.

In larger states like Texas, premiums are generally about 20%-30% higher than national averages, whereas in smaller states like New Mexico, they usually are about 20%-30% cheaper.

The location and size and type of your Karaoke business can have a big effect on the cost of different policies.

You should discuss with professional insurance agents and brokers, or insurance company representatives.

In addition you can let the internet do the work for you by searching for insurance companies near where your business is located.

Another good source of information is the local Better Business Bureau in your city.

FAQ

What is small business insurance for Karaoke operations?

This is a wide term used to describe basic insurance policies designed to protect Karaoke business owners from risks like bodily injury, property damage, claims of negligence.

Does my Karaoke business have to have insurance?

Some of the types of insurance are not mandatory for you to run your business, but they can protect you from risks in your business operations.

Several other forms are required by state law, such as workers compensation and vehicle insurance.

What does a small Karaoke business insurance policy cover?

Liability insurance provides protection against lawsuits or claims filed by a third-party for bodily injury, property damage, or negligence.

The exact cover will vary based on your own operations.

See the table in the costing section above for average prices of the best policies for Karaoke insurance.

How much will Karaoke business insurance cost?

As well as the size of the business, some other factors, such as location and claims history, are used to determine your policy’s cost.

You should talk to professional insurance agents and brokers, or insurance company representatives.

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