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Business Insurance Basics for Interior Designers with Stephen Wisocky

March 15, 202438 min read
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We need to talk—about insurance. Specifically, insurance for interior designers. Before you roll your eyes, I can promise this won’t be a dry, boring conversation about insurance! Stephen Wisocky joins me for this in-depth look at the types of insurance you do and don’t need as an interior designer. As the only Insurance Partner of the Interior Design Society, I couldn’t think of anyone better to invite on for this conversation! 

Have you ever found yourself wondering what coverage you need for subcontractors, or what auto insurance you might need (for those trips to market), or simply what all the insurance acronyms mean? Whether you’re just thinking of starting a design business or you’ve grown your firm over the years and want to make sure you’re protected—this episode will bring you clarity. Stay til the end of the episode to hear about the wildest liability claim Stephen’s ever seen and to see if the Colorful Question is yours! 

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In this episode, we cover:

  • The types of insurance interior designers must have 

  • What is covered by general liability (GL) insurance 

  • The difference between general and professional liability (PL) insurance 

  • If your business setup (LLC, S corp) affects your insurance rates 

  • Examples of GL and PL rates for designers 

  • When an interior designer needs workers’ compensation 

  • The auto insurance you need even if you don’t have a company car 

  • Insurance types you should have if you have employees at your firm 

Who knew insurance could be such a colorful topic? If this conversation helped you better understand your firm’s insurance needs, let us know—find us and let us know so we can cheer you on!

More about Stephen Wisocky

Stephen J. Wisocky, founder and president, has over 40 years of experience as a property and casualty insurance broker. With a home furnishings background beginning in 1986 he has become a trusted insurance advisor for many of the industry's top retailers, suppliers, representatives and designers. Today, HFIG is the only Insurance Partner of the Interior Design Society (IDS).  

Links and Mentioned Resources

The Studio 

Ep 17: The Legal Side of Running a Design Firm with David Adler 

Ep 19: How to Hire a CPA for Your Design Firm with Kate Snelson 

Book your Coaching Strategy Session with Katie! 

Grab your GUIDE: Essential Insurance Guide for interior designers

Connect with Stephen Wisocky

Home Furnishings Insurance Group 

This episode is brought to you by Nello Marelli

Struggling to stay ahead with the ever-evolving design trends while running your business? Discover the secret weapon of the design world - the 2025 Nel Colore Color Trend Book. Crafted by the renowned Italian designer Nello Morelli, whose expertise guides luxury brands from Milan to Paris, this tool is now stateside with our partnership. Get exclusive access to future color trends, combinations, and sociological insights up to two years in advance, ensuring your designs stand out. Elevate your projects and leave the trend-watching to us. Find the Nel Colore Color Trend Book, along with a mini version, exclusively in The Studio. 

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More about Colorful Conversations with Katie

Welcome to “Colorful Conversations with Katie”! Join us for a vibrant webcast where we seamlessly blend the realms of design and business in a fun and professional setting. Available on YouTube or any of your favorite podcast platforms!

Hosted by the dynamic Katie, a seasoned expert with nearly 20 years of experience in both fields, this engaging series promises to ignite your creative spark and sharpen your entrepreneurial acumen. From exploring the latest design trends to uncovering strategies for building successful ventures, we dive deep into the colorful world where aesthetics meet profitability.

Whether you’re a budding designer or a savvy entrepreneur, this webcast is your go-to source for inspiration, insights, and a dash of lively conversation. Tune in and let your imagination, business and life take flight!

This post may contain affiliate links, so I may earn a small commission when you make a purchase through links on my site at no additional cost to you. 

This episode of Colorful Conversations with Katie is brought to you in partnership with Leah Bryant Co.

The unedited podcast transcript for this episode of the Colorful Conversations with Katie podcast follows

Katie (00:01.691)

Hey Steve, welcome to the show. Good, we're so glad to have you aboard. And this topic is one that we know we need to have, and yet sometimes it's a little overwhelming, it's a little daunting, and us creative types go, oh, insurance, and we take our no-dos, and we do what everyone says, and we get it, but we don't know if we've got the right one, or enough, or whatever. So today we're gonna be, we're gonna pull on our big girl panties, and we're gonna do the hard work, and we're gonna figure out, and we're gonna crack the nut on insurance.

Steve Wisocky (00:03.414)

Hi, Katie, how are you?

Steve Wisocky (00:17.183)

That's right.

Steve Wisocky (00:31.566)

Okay, let's do that.

Katie (00:32.067)

You do insurance for interior designers. What are you? Let's start with all the acronyms. GL, PL, auto, workers comp, all of it. If I'm an interior designer, what do I need?

Steve Wisocky (00:35.106)

I do.

Steve Wisocky (00:48.05)

Okay, the main thing that any prudent business person needs for any type of business is general liability insurance. Okay, general liability insurance, to explain it a little bit better, is I'm gonna read this off of my notes so I don't miss any of the important points, okay? Exactly, all right. General liability insurance is insurance coverage that protects you, the insured.

Katie (01:08.615)

All the fine print. Yes, go ahead.

Steve Wisocky (01:17.406)

against claims or lawsuits filed by clients or third parties resulting from your negligence which causes bodily injury or property damage. Okay, so those are all the main points.

Katie (01:17.463)

Okay.

Katie (01:26.775)

Hmm.

Katie (01:32.011)

Okay.

Steve Wisocky (01:35.142)

to third-party type coverage, so someone else has to get injured as a result of your negligence. One of the main points is I bring up that I say that's a claim or a lawsuit. A claim for general liability amounts to anyone that you injure or damage their property that says to you, how are you going to fix this? It's basically a demand for money.

Katie (02:00.107)

Hmm.

Steve Wisocky (02:01.826)

When someone asks, says, hey, how are you going to pay for this? How are you going to fix this? Anything like that. I want $10,000. Anything like that. It's demand for money. So that is actually a claim that can be filed under your business, under your general liability insurance coverage. General liability insurance is $0.00.

Katie (02:03.169)

Yeah.

Katie (02:25.011)

So I play it, oh go ahead. Well.

Steve Wisocky (02:29.454)

is for those unforeseen accidents, situations where you don't have care or care, what we call care custody or control of a situation. It's for those lawsuits or claims that are accidents and by the term accidents. So I think that answered your question, I hope. Okay.

Katie (02:53.479)

It does. I love to play a game when we have experts on, especially in very specific arenas, whether it's an attorney or an accountant or in this case insurance, I like to play the but game. So, but Steve, I just started my business and I can't afford general liability insurance yet. Do I really have to have it?

Steve Wisocky (03:15.006)

Yes, absolutely.

Katie (03:17.223)

Why? I agree, but tell me why.

Steve Wisocky (03:20.462)

Because it does protect you against those unforeseen situations, things that you can't control. If you could control everything, we wouldn't need insurance. Yeah, exactly right. That's right. But it's those unforeseen situations. Let's talk about interior designers, OK? What types of exposures that they have, OK?

Katie (03:28.135)

I wish. That'd be a great life.

Katie (03:39.254)

Yeah.

Katie (03:43.977)

Yeah.

Steve Wisocky (03:46.706)

If some designers have offices either in a public building or in their own home, where customers may come to visit them, look at different samples, look at their plans for redecorating their house and designing their home.

Katie (03:59.563)

Hmm.

Steve Wisocky (04:08.202)

when they come into the home or into an office, there could be a situation where they might slip and fall. The customer trips over the dog, you'll see, trips over the dog or trips over a stool that's in their way or simply falls over something on the way to the office in a public building. And that designer could get named in that lawsuit or have a claim against them.

Katie (04:14.259)

Yeah.

Katie (04:18.303)

Hmm.

Katie (04:22.672)

Mm-hmm.

Katie (04:28.533)

Yeah.

Katie (04:33.048)

Uh, yep.

Steve Wisocky (04:36.682)

That happens not too often. Okay. But the main thing is that what designers do is that they go to customers homes. Okay. So you go into a customer's home to meet with the customer, husband, wife, whatever. And let's say you get the job and now you're going to do some measuring. Okay. You got to measure some things.

Katie (04:47.858)

Yeah.

Katie (04:59.991)

Sure, very plausible.

Steve Wisocky (05:02.302)

So you're going into the home and you start measuring and all of a sudden, accidentally, again, keep in mind, it has to be an accident. You knock over an expensive family heirloom face, okay, that costs, yeah, exactly, that costs like, that's, you know, and they come back and they say, hey.

Katie (05:17.747)

I just cringe thinking about it, but yes, nobody wants to think about this.

Katie (05:27.032)

Yeah.

Steve Wisocky (05:28.95)

hey, Katie, you know, you got to pay for that. And it's a family heirloom and it's $10,000 and so on and so forth. That's right, yep. Yeah, that's right. Yeah, my grea had it and all that neat stuff. That's right, that's right. So that's a property damage claim and that would be covered under general liability insurance, okay? Now.

Katie (05:36.219)

It came from China and it's precious and all the things and you're having a heart attack. Yeah. Right, it's the Fabergé egg of the family, yeah. Yeah.

Katie (05:54.877)

Okay.

Steve Wisocky (05:56.398)

Let's get something straight though. So you understand, this is the interesting part of General I Bill insurance, is that it, we said that anything that's in your care or cost of your control would not be considered an accident. So let's look at that vase. The vase, you grab the vase, right, and you're gonna move it so you don't bump into it. And so you grab the vase and you're moving it to put it on another table and you drop it.

Katie (05:58.056)

Yeah.

Katie (06:15.133)

Uh...

Okay.

Katie (06:26.709)

Yeah.

Steve Wisocky (06:26.962)

That's not covered. Okay? Because that was... I know. That's right. Yeah, because it's in your... Because it's a situation of care, custody, or control. Okay? You were controlling it. Okay? So it wasn't considered an accident. Ah, there you go. There really isn't anything that can cover something like that. Any... Yeah, exactly. Yeah, so...

Katie (06:30.323)

But Steve, I just paid for general liability. What do you mean it's not covered?

Control.

Katie (06:43.559)

Okay, so what insurance do I need for that? Yeah.

Katie (06:52.079)

I'm paying for the vase at that point. Ugh, ugh, ugh. Okay, let's, yeah. No, you go first. Oh, do it.

Steve Wisocky (06:57.894)

So, good. Two other situations that designers run into, okay, one is subcontractors, okay. You have a subcontractor that comes in and is doing some painting and accidentally spills a can of paint on the new oriental rug you just put in for the client, okay. So the client wants to get reimbursed for that.

Katie (07:08.515)

Yep. Very common.

Katie (07:21.419)

Sure.

Steve Wisocky (07:26.134)

So that would be a covered situation. Now something to keep in mind as a designer is whenever you do business with any type of a subcontractor, painting, whatever it may be, installing a kitchen, putting in a new bathroom, delivering furniture, the warehouse delivery people, you need to make sure that they have general liability insurance. So that's what we do.

Katie (07:30.111)

Hmm.

Katie (07:36.437)

Yeah.

Katie (07:44.575)

That's a big one.

Katie (07:52.369)

Yes, you do.

Steve Wisocky (07:55.158)

Our policy will cover a general liability policy will cover you The insured but it won't cover the subcontractor. Okay, but So if the client comes back and says

Katie (08:04.539)

Mm-hmm. So I want everyone to hear what Steve just said, because I think this is so incredibly important. When you get general liability, did you hear what he said? It only covers you. It does not cover your subcontractors if something goes wrong. This is why in our firm, we require that every sub produce a COI, or certificate of insurance.

before they go out. I'm glad to see you smiling because it's not always fun to get, but we won't, a COI, oh, oh my gosh, not even. No, but I know enough to know that if you don't have a COI, you're not going on our job. Because if you, then if your sub does something on that job and you don't have a COI to hand over to your insurance company and they were your sub, guess what? All of a sudden it's back on you. And that's enough of a motivator for me to go find their COI or not let them on my job site.

Steve Wisocky (08:34.294)

A COI, you're pretty much an expert. That's insurances.

Steve Wisocky (08:44.258)

There you go, exactly.

Steve Wisocky (08:55.598)

That's right.

Steve Wisocky (09:00.31)

Perfect. Exactly.

Katie (09:02.515)

Right? Because, and I think it comes down to every single entity going out on that site. And we've even had times photographers are a big one where they do a ton of residential real estate and they're like, Oh, I'm good. I'm great. I'm going to go out. I'm going to photograph this house. It'll be a hundred percent fine. And you go, where's your COI? And they go, I've never gotten a request for that. And I'm like, to your point about the family heirloom,

Steve Wisocky (09:10.711)

Yes.

Katie (09:25.055)

That's all good and fine until you're backing up in the living room to get the better angle and you knock over that base. And now I'm responsible for that because I don't have your COI to give to my insurance company so they can go after your insurance company, which sounds really horrible. But this is what happens in the world of insurance. This is why we have insurance, right? It's business. It is business. And I think that's the key point too. It's such a good point. Like it may not be something fun and it's not beautiful and it's not our next mood board.

Steve Wisocky (09:41.423)

That's business. Simple as that. Yeah, it's business.

Katie (09:51.223)

but you're not gonna be around to create your next mood board if you're gonna have to write a check for 10 grand for the missing heirloom. And so we just have to pay for this. Talk to me about the difference though between that and professional liability. So we have general liability or GL as it's often called in the industry, and then we have PL. Yeah, why do we need PL if we have GL? Yeah.

Steve Wisocky (10:02.798)

Okay, general bill.

P.O. Professional liability, well, because they both, they're contradicting, well, let's put it this way. General liability has an exclusion in it for professional liability. In other words,

Katie (10:16.017)

Mmm.

Steve Wisocky (10:21.974)

We're going to exclude anything that is considered a professional liability claim. Oh, absolutely. And then professional liability has the same exclusion going back to general liability. If it's considered a general liability claim, then it's not going to be covered in the professional liability. Professional liability basically says, again,

Katie (10:23.623)

Oh, it does? That's a little secret. Oh, nobody's ever told me that before.

Steve Wisocky (10:42.578)

any negligence from bodily injury or property damage that you may cause that is in a professional nature. Professional nature. Very broad. Is there a definition? Not really, but at the same time, exactly. And it's...

Katie (10:52.503)

Okay. Yeah. Yeah, it's like nailing jello to the wall. What does it mean?

Steve Wisocky (11:02.654)

It's also considered, what we term it as, errors and emissions. Okay, and that's the right term to use in the interior design society. Okay, or industry, is that you can make an error in measuring, you can make a different error in ordering. I always like to use the situation, okay, Katie, you're my designer and you and I agree.

Katie (11:07.715)

Ah.

Katie (11:16.437)

Yeah.

Steve Wisocky (11:33.108)

that you're going to redesign, refurnish my home, my living room, and you're going to buy a black leather sectional sofa, okay, and you go back to your office and you order it, okay, comes in a few weeks later and turns out, oh jeez, this isn't what I ordered, it's a white upholstered leather, white upholstered sofa. Well, I don't want that.

Katie (11:38.513)

Okay.

Katie (11:59.411)

Right.

Steve Wisocky (12:01.966)

Katie, you've got to eat that. And that's what errors and emissions would cover, a situation like that. And that's what I see all the time in professional liability.

Katie (12:04.361)

Ah.

Katie (12:07.819)

Gotcha.

Katie (12:11.367)

Okay, here comes another but Steve, but Steve is it gonna cost me more to file a claim on my Arizona omissions insurance than it is to just eat the cost of the sofa at this point? I feel like, no, okay, tell me more.

Steve Wisocky (12:21.642)

No, not really. There's no deductibles on professional liability. There's no deductibles on general liability either. Professional liability usually costs, depending on the state that you're in—it's very provincial in terms of its rates. New York, very high.

Katie (12:27.031)

Oh, OK.

Katie (12:46.42)

Yeah.

Steve Wisocky (12:46.562)

Philadelphia, Pennsylvania, very high, a lot of lawsuits, a lot of attorneys, all that kind of stuff. Allentown, Pennsylvania, half the price of something in Philadelphia. Exactly, exactly. So most of the time you'll see that ranging in costs from $500 a year.

Katie (12:49.162)

Yeah.

Katie (12:52.597)

Mm.

Katie (12:57.875)

Wow, they're just not having the claim history. Yeah.

Steve Wisocky (13:09.698)

and depending how big your firm is, to about $1,000 a year. But the average I've seen across the country is about $700 a year for a million dollars of professional liability. Now I offer, I'm gonna do a little ad here, our professional, our general liability insurance, okay, for a million dollars of coverage is only $250 a year. Okay, yeah, so that's what we have to offer through.

Katie (13:21.687)

Okay, do it.

Yeah.

Katie (13:31.851)

That's amazing.

Katie (13:35.451)

Is that regardless of how you're set up like as an LLC or if you're an ink or it doesn't matter?

Steve Wisocky (13:39.638)

That's exactly right. It does not matter. And it does not matter where you are. You could be in New York City, and you could be in Allentown, Pennsylvania. It doesn't matter. It's $250 a year. And that's through the buying power of the Interior Design Society that we're able to get those type of rates.

Katie (13:44.799)

I need to talk to you after this call. Yeah.

Katie (13:54.075)

Yeah, we love IDS. We're proud members. They do great work. They're good people. And they represent the good people, which is a great thing as well. OK, but Steve, do I need workers' compensation?

Steve Wisocky (14:01.683)

Absolutely. Yep, definitely.

Steve Wisocky (14:08.49)

Well, workers' compensation is coverage for your employees. If an employee is injured on the job...

Katie (14:13.225)

Yep.

Steve Wisocky (14:16.018)

That's what workers' comp would cover, their health, their medical bills, and any type of disability that they may have. Every state is different. It's what we call a statutory coverage. It's written according to whatever the state law is as far as benefits are concerned. Pennsylvania is very broad. We have full coverage on medical, and they get 66 percent of their salary while they're off on

Katie (14:24.981)

Yeah.

Katie (14:41.748)

Wow.

Steve Wisocky (14:44.082)

on leave from their job. Other states are less, 50 percent. Some states don't offer. Depends on where you are. But at the same time, it's really only if you have employees. If you don't have employees, then you don't need workers' compensation.

Katie (14:45.689)

Mm. Mm-hmm.

Katie (14:53.239)

Hmm.

Katie (15:02.587)

Well, and here's a really interesting little tip that I learned the hard way. So I'm in Washington state, kept trying to get workers compensation and it was required by one of my clients, and which is fine, went round and around and around and around with so many different insurance agencies and no one would tell me why I couldn't get it. And I'm like, I swear to you.

Steve Wisocky (15:20.034)

Ha ha ha.

Katie (15:21.375)

I'm a good upstanding business over here. I've done my part and I play nice in society. Why can I not get workers compensation? I'm trying to give you money. And there's this crazy situation where there's five states in the country, Washington being one of them I learned. So if you're having the same problem, I am here to save you the legwork where you have to go through the state and it doesn't go to the fair market. So you cannot go out to a fair market bidding process. I have to contract with the Labor and Industry Department of the state of Washington.

Steve Wisocky (15:23.49)

That's right.

Steve Wisocky (15:28.736)

Yeah.

Steve Wisocky (15:33.13)

Yes.

Steve Wisocky (15:37.291)

Hahaha

Katie (15:50.443)

to get my workers' compensation and I have no alternative. So if you're like, been trying, or if you ever run down that path, tuck that little nugget away for a rainy day and be like, am I one of those five states? Because I spent a lot of time before I figured it out and someone finally said, well, you know why, right? I'm like, no one can tell me why, thank you, that means a lot. So if we're looking at, oh, go ahead.

Steve Wisocky (16:11.743)

Yeah, that's what we call in insurance talk or in the industry is monopolistic state. Monopolistic. Yeah. So it's Washington and Ohio, not only are there five states, but there are three states. But those are the two, yes.

Katie (16:18.941)

I agree wholeheartedly.

Katie (16:27.655)

Yeah, yeah, it's kind of a thing. Okay, what other insurances, once we unpack all the different types, we're gonna talk about the different setups of your organization. Like if it's just you, you need this. If it's you and a couple of contractors, you probably need this. I just wanna give that hierarchical view. But before we do, are there any other insurances that we're missing? Auto being one of them, if you have a company car that we should probably visit about. This is one that comes up for us, even though we don't have a company car per se.

Steve Wisocky (16:52.334)

Correct?

Katie (16:57.331)

that anytime we take a car out on a job site, they wanna know we're covered in some regard.

Steve Wisocky (17:02.894)

Exactly. You should have a coverage under automobile, which is called hired and non-owned auto. Hired automobile liability is covered for when you rent or lease a vehicle, like you said. Go to the High Point Market, you go to Vegas Market, you rent a vehicle. You would be covered under that policy for liability. You still may have to buy the physical damage on that vehicle.

Katie (17:07.978)

Yep.

Katie (17:12.523)

That's the one.

Katie (17:26.917)

Yeah.

Steve Wisocky (17:31.222)

the comp and collision from the company from Hertz or Avis or whatever. Yeah, but the liability coverage is covered under that policy. Now, it also covers the hired auto liability, which is important. It would cover if the subcontractor that's delivering furniture for you, the third party, has an accident.

Katie (17:34.022)

Now we're back to that VAS again. Yeah.

Katie (17:41.596)

Okay. Yeah.

Steve Wisocky (17:56.086)

And for some reason they found out or the customer found out that they were delivering for you as a designer and could get named in that lawsuit. So that would be the hired auto liability coverage that would pick that up and cover you for that situation.

Katie (17:56.137)

Oh.

Katie (18:04.938)

Yeah.

Katie (18:12.927)

That makes sense. That's the only one that picks up your subcontractors though. That's really important to note. Listen to what Steve's saying. It's hired in non-owned auto only. Your GL does not cover your subs. That's why they need to produce their own certificate of insurance before you let them on their job.

Steve Wisocky (18:24.489)

Exactly.

Steve Wisocky (18:28.338)

Non-owned liability is a situation if you had employees, and let's say you're a bookkeeper or had to run to the bank, had an accident during work time and the firm or your company would get sued as a result of it. So that's not ownership. Not a big exposure, but at the same time, they kind of come together, hired a non-owned auto. Yeah, exactly.

Katie (18:34.426)

Yep.

Katie (18:46.024)

Yeah.

Katie (18:53.875)

I was going to say I've never seen them apart, but yeah. So we've talked GLPL, Workers Comp, Auto. Are there any other insurances that are critical?

for designers to be aware of.

Steve Wisocky (19:08.219)

If you have, again, we go back to if you have employees. I think one of the key coverage right now, which is big in society with the Me Too movement and all that stuff is employment practices liability, which covers you against your…

Katie (19:13.392)

Yeah, that's a big one.

Katie (19:24.907)

Mm-hmm. Mm.

Steve Wisocky (19:28.438)

Like it says in employment practices, an employee comes back and says that they were harassed sexually or they were harassed by someone in the office or something like that. If you discriminate, that would be covered under that.

Katie (19:31.803)

Interesting.

Katie (19:44.883)

Mm-hmm.

Steve Wisocky (19:47.326)

If you term it for termination, wrongful termination is another big item under employment practices liability that you should carry, why you should carry it. And age discrimination, race discrimination, anything like that. Yeah, exactly. I didn't get the job, you know, because I was 75 years old.

Katie (19:51.083)

Hmm.

Katie (19:55.147)

Hmm... Yeah.

Katie (20:01.979)

Yeah, there's so many of them. I mean.

Katie (20:11.033)

Yeah.

Steve Wisocky (20:11.574)

They come back and sue you or you get terminated because you're 75 years old, and they come back and sue you as a result of that. That's what employment practice liability would cover. So if you have employees, definitely look at getting that coverage. And then going hand in hand with that, if you have employees and you have a staff doing your books and a bookkeeper and all that good accounting stuff, is employee dishonesty. Okay, someone gets into your checkbook.

Katie (20:13.768)

Yeah.

Katie (20:20.395)

Hmm.

Katie (20:26.73)

Yeah.

Katie (20:39.3)

Interesting. Yeah.

Steve Wisocky (20:41.542)

and they start writing checks, and all of a sudden, you're a bunch of money in the hole, and it's an employee stealing from you. So that's what employee dishonesty would cover. So something to consider. Another elective coverage. It's another. That's right.

Katie (20:43.99)

Yeah.

Katie (20:54.035)

So that's a whole nother policy, employee dishonesty policy. Interesting. Do either of these have a deductible, the employee dishonesty, or the it's escaping me, the one you just mentioned? Yes. OK.

Steve Wisocky (21:04.642)

The employment practice liability we'll have is deductible. Depending on the size of the firm, it would probably be the lowest you'd see is $1,000. And then you could buy up to $10,000, depending on what you feel comfortable with.

Katie (21:15.467)

Okay.

Katie (21:19.131)

And that is one where you, so that deductible is what you're paying out of pocket before the insurance policy kicks in. It doesn't exist for the GL and the PL, but it does exist for these two. Okay.

Steve Wisocky (21:29.374)

Yes, exactly. And there's no deductible on workers' compensation and no deductible on the hired and honored automobile that we spoke of. So, yeah.

Katie (21:38.195)

OK, those are all zero deductible. Well, and it's interesting they tack on a deductible to this, because I feel like these two policies you're mentioning are ones that have come about in the last, I'm going to guess, 10 to 15 years. That's just a hunch. But it's become part of, as there's a societal shift, there's going to be an insurance policy to match it. But there's probably so many of these, kind of like car wrecks. This is why we have a deductible, because it's such a common occurrence.

Steve Wisocky (21:49.32)

Exactly.

Steve Wisocky (22:05.486)

No, that's exactly right. When Employment Practices Liability Insurance first came out, what you said, like 15 years ago or so, it's probably a little bit longer than that. It came out originally when the American Disabilities Act was put in force. And what you saw was employees that were

Katie (22:12.608)

Yeah.

Yeah.

Katie (22:19.661)

Mm.

Oh, interesting.

Okay.

Katie (22:28.592)

That's a few decades ago.

Steve Wisocky (22:28.654)

insured or had disabilities and they couldn't get into the buildings or they had, you know, they couldn't go to the bathroom properly. And, you know, attorneys got a hold of that, and all of a sudden, employment practice liability came about. So when insurance coverage first comes about, you'll see the cost of it being very high. OK. Yeah. So then there you go. That's exactly right.

Katie (22:32.338)

Yeah.

Katie (22:42.219)

for sure.

Katie (22:51.039)

For sure. Probably because they just don't have the metrics yet to know what's a fair market value, right? Yeah, that makes sense.

Steve Wisocky (22:56.43)

That's right. Yeah, so that's what happened. Now, we saw employment practices liability over the years go down in costs. And then when something else happens, there you go. That's right. Yeah, really. Yeah, that's right. No, definitely not. But at the same time, then all of a sudden, the me too hit.

Katie (23:06.099)

Nice. Finally, insurance going down, Steve. Can we just enjoy that moment? Anybody else had their insurance go down lately? Not me. Not in any regard.

Steve Wisocky (23:25.274)

And all of a sudden the rates start going up again, because they weren't, yeah, something that they weren't thinking about or expecting or whatever. So that can always affect your insurance rates. But we always have to remember, Katie, that insurance companies are not for profits. Okay, they're not for profits. There you go, not non-profits. That's right.

Katie (23:25.395)

Yeah. Yeah, it's just market reflective.

Katie (23:44.471)

Yeah, that's a bummer. I was hoping they'd be a nonprofit, but they are not. Well, most of them are even traded, aren't they? I mean, aren't most of them on the index? I mean, these are big companies doing, yeah. There you go. I mean, they're all there and they're in the interest of making profit. So let me ask you, if I'm gonna be smart about the dollars I'm gonna give them, because we know they're all profit, they'd sell us all the possible policies in the world. But let's start out. It's just me. I'm starting out on my own.

Steve Wisocky (23:53.67)

Oh absolutely, they're public companies. Yep. The Hartford, Travelers, yep. Yeah, big companies.

Katie (24:14.267)

Steve, out of all these, I think we're up to six or seven policy, different types we've discussed now. What are the ones I need if it's just me, no employees, and I'm just hanging out my shingle and figuring this out.

Steve Wisocky (24:27.062)

Yeah, exactly. I get those calls probably two or three times a week. And the main coverage, as we started with the conversation, is general liability. And at $250 a year for my policy, you've got to afford it. Twenty dollars a month? Crazy. It really is.

Katie (24:32.427)

There you go.

Katie (24:40.011)

Sure.

Katie (24:44.199)

You can afford this. Yeah. Well, that's more than a lot of subscriptions we pay for design stuff, software. Yeah.

Steve Wisocky (24:55.314)

If you went to another agent across the street or in town or whatever, that policy is going to be double. I can guarantee you that, because insurance companies usually write minimum premium policies. The minimum premium for general liability policies stand alone is $500.

Katie (24:59.414)

Yeah.

Katie (25:19.898)

Ah.

Steve Wisocky (25:20.554)

where we chopped it in half at 250 because of, again, the group buying power of the Interior Design Society. Then what I normally would explain to a designer that's just starting out like that, I'd say, you've got to get this, you've got to have this general liability.

Katie (25:25.659)

Yeah. Nice.

Steve Wisocky (25:37.422)

And then we go into the professional live building, we discuss the errors in emissions coverage, and then we let that as an elective type situation. What makes you sleep at night, Katie? You feel better with buying the 500 hour? That's right, yeah, that's right. Whatever makes you sleep better. Yeah, there you go, that's right. Oh gosh.

Katie (25:37.526)

Right.

Katie (25:50.409)

As I'm getting older, Steve, it's a good insurance policy. I mean, it used to be a lot of other things in my youth, but now we're just down to good insurance and great health care. That's all I got.

That is so true.

Steve Wisocky (26:05.674)

But yeah, that's the world we live in.

Katie (26:08.507)

It is. Okay, so let's say I've graduated and I now have a couple of subcontractors working for me. How does that change things? They're doing, they're not just delivering furniture, but maybe there's subcontractors doing some of my design work and I now have a bookkeeper doing five hours a week who's a subcontractor who's actually working in my business not just

Steve Wisocky (26:12.174)

Okay. Oh, wait.

Katie (26:30.803)

I don't want to say four, but they're not just delivering the furniture. They're actively involved. Does that change my liability and do I need a different additional policy at that point?

Steve Wisocky (26:38.738)

Yeah, you're going to have to buy a different liability policy. For a firm like that, what you're talking about.

Katie (26:42.486)

Okay.

Steve Wisocky (26:48.946)

You want to get higher limits. You want to make sure that you have more exposures. I mean, definitely with the subcontractors and things like that. You still want to get those COIs, okay? But yeah, we have to build a better program for you in that situation, yeah. The 250 isn't right for you.

Katie (26:51.199)

Yeah.

Yeah.

Yeah.

Katie (27:02.036)

Yeah, that's a key word.

Yeah, that makes complete sense.

Katie (27:11.611)

No, we have too much liability, so we need more coverage at that point. So the tipping, yeah, that makes sense. And if I'm hearing you right, it feels like the tipping point in this whole, I don't wanna call it a game, but an insurance game, is once you bring on employees, when you bring on employees, we're in a whole different ball game for now all of a sudden everything. We're talking about, we're talking about workers comp, we're talking about

Steve Wisocky (27:15.078)

That's right. You want to buy higher than the million. So million dollars worth of coverage. Yeah.

Steve Wisocky (27:34.112)

changes the whole thing.

Katie (27:40.959)

employee discrimination policies, potentially we're talking about, I mean, you're gonna add at minimum three additional policies, it sounds like, to me once you hire that first employee.

Steve Wisocky (27:52.362)

Yeah, when you're going to bring on additional designers, you're going to want to buy professional liability to cover the firm. Because really, you don't know what those other designers are doing. I mean, they could be the best. Yeah, you could be the best of friends. They don't do things the way you do things. And you do things better than anybody else. Exactly.

Katie (28:06.879)

They can forget stuff. Sure, we're all human. Yeah.

Mm-hmm. It's your firm. Yeah, yeah.

Steve Wisocky (28:22.21)

for sure, and then employing Praxis liability, definitely, yeah, I would get those coverages.

Katie (28:29.587)

which can sound really scary, especially if you're just starting out, but it really shouldn't because as your business grows, you're gonna be able to afford those additional coverages that come alongside it. What I really love about this, yeah, I know I once had an accountant say that to me. I was like, I was paying how much to the government? And she goes, you should be proud you're paying this much to the government, because it means you're making this much. And I was like, that still feels really gross to me, but okay, sure, we'll go with that.

Steve Wisocky (28:37.838)

That's right. Congratulations, right? Congratulations. That's, there you go. That's right. Yeah, that's right. That's right. I know, I know. Yeah, yeah.

Katie (28:59.46)

But no, it's true. And I think that's like a key point. As you grow, your insurance coverage should grow right alongside you. So you're not sitting here with a baby policy when your business is no longer at inception your five years down the path. These need to keep pace.

Steve Wisocky (29:12.886)

Bingo. Yep.

Katie (29:14.635)

best insurance story ever. I wanna hear. Could be comical, could be, I wanna hear your best interior design story because this can be a dry topic. I think this has been a great conversation, but I am dying to hear what your, cause you've been in this for decades. What is...

Steve Wisocky (29:19.735)

Hahaha!

Okay.

Steve Wisocky (29:32.522)

Well, I'm going to get—nothing really exciting in its interior design area. Because there is exposure. Yeah, knock on wood. That's all good. But I've got to tell you about the craziest liability claim that I ever had. I insure a yogurt ice cream—

Katie (29:40.459)

good. We're a pretty solid industry we like to think, you know, yeah. Yeah.

Katie (29:52.723)

What happened? Oh, I'm dying to hear it.

Steve Wisocky (30:01.622)

type store, has a number of stores throughout the state of Pennsylvania. This one happened to be out in State College, Pennsylvania, out in Penn State. In springtime, everybody's buying yogurt, ice cream, coming into the store. Gentleman comes by with his dog and takes the dog and he ties him up to one of the chairs that they have outside. You know how they put little tables outside.

Katie (30:07.144)

Okay.

Katie (30:28.839)

Yes. Oh no. Yeah.

Steve Wisocky (30:29.982)

chairs and the umbrellas so you could eat your yogurt and things like that. Goes into the yogurt, gentleman goes into the yogurt store and all of a sudden he hears this rumbling and here what happened was the dog took off with the chair. So the dog's running down the street with the chair, runs across the street and there's a lady and her daughter, little girl, standing across the street. It's a...

Katie (30:49.943)

This is great. Yeah. No.

Steve Wisocky (30:58.382)

It's kind of sad because what happened was the dog runs by and the chair hits the little girl, you know, and knocks her over. She was okay, but you know what, but do you know what her mother's occupation was? That's exactly right. Yeah. I think that was, I think that's the best one. I think that's the best one. That's not so bad. You know, I mean, I could tell you some pretty gross ones, you know, but…

Katie (31:03.819)

Oh no. Oh gosh, is she okay? Okay.

Katie (31:12.663)

attorney? I had a feeling. This isn't going to go well. Yeah.

Katie (31:23.855)

No, it's not gory. So did she, and this is what's a key point, is she didn't go after the dog owner, she went after the yogurt shop. And so that's where if you're thinking this doesn't apply, very much applies, even though it was, I wanna use a kind term, but the irresponsible dog owner who left their dog attached to a chair, we don't know the size. I mean, if it's a Great Dane, that's not your brightest day, right? But if it's a Yorkie, I get it.

Steve Wisocky (31:32.142)

That's exactly right.

Steve Wisocky (31:37.687)

Yeah.

Steve Wisocky (31:46.222)

That's right.

Steve Wisocky (31:49.694)

Right.

Katie (31:52.295)

Either way, left the dog detached to the chair, and now the onus isn't on the dog owner for that decision, but because he was frequenting that business, such as your establishment, now you're liable for it. And that's why you pick up the phone and you call Steve, because...

Steve Wisocky (31:57.654)

No.

Steve Wisocky (32:07.256)

That's right. Yeah, because, yeah, they went right to the yogurt store. You know what I mean? That's how I found out about it. We had to file a claim as a result of it, was that's who they looked at. Yeah, yeah. So, so anyway. Yeah.

Katie (32:12.479)

That's insane.

Katie (32:17.803)

That's absolutely nuts. Yeah, that's incredible. Great story. Great conversation, Steve. One final question for you. What is one thing you feel like designers always miss or don't see when it comes to insurance? What is our blind spot as an industry when it comes to insurance? Let's just have the honest conversation and throw it out there.

Steve Wisocky (32:37.67)

I think it's just a matter of not wanting to pay for it. That's what I see as the blind spot. Yeah, it's as simple as that.

Katie (32:42.583)

Sure, yeah, very fair.

Katie (32:50.651)

Yeah. And that's one where I, we, yeah.

Steve Wisocky (32:52.242)

Oh, I can't afford it. Oh, I can't, you know, oh, I don't need it. And I can't afford it. But that's how we did the, that's how we did what we do with interior design societies, is make it affordable.

Katie (33:05.503)

I think that's brilliant. And that's one thing we coach too, is it's CDB. CDB, cost of doing business. There are just these costs if you're gonna be in business, because if you don't pay them, you're not gonna be in business. If you're on the receiving end of that lawsuit, and you don't have your proper legal structure set up, like we talked about with David Adler, we'll put the link to that in the show notes to this episode.

Steve Wisocky (33:12.983)

There you go.

Steve Wisocky (33:20.354)

That's right.

Katie (33:30.631)

If you don't have your accounting practices in order, like we talked about with Kate Snelson, and we'll put the link to that episode in our show notes, you're not gonna be in business. And if you don't have insurance to go back to, and you have to write that check out of pocket because you don't have the money in the bank, or you're not properly structured, or you don't have an insurance policy, you're not gonna be in business. And I hate saying that, but all it takes is one episode like that for you to not only lose your business, but to lose your personhood financially.

Steve Wisocky (33:48.192)

Yeah.

Steve Wisocky (33:55.79)

for watching.

Steve Wisocky (34:00.334)

video.

Katie (34:00.503)

And that's like, I know this isn't the sexiest topic and we're not all sitting here drinking champagne, but it is incredibly important if you're actually in the business of building a business, which is more than just designing.

Steve Wisocky (34:11.294)

Right, right. And we talk about, you know, your business and all that, but the other thing that we missed in, your description was perfect, but it's your reputation.

Katie (34:19.923)

Yeah. Oh, please bring it right up.

No, so true. It's absolutely your reputation.

Steve Wisocky (34:26.47)

Because it's your reputation and that rises above all else, I think.

Katie (34:33.695)

Boy, isn't that the truth? People talk. It doesn't matter if you're in LA, New York, or if you're in, you know, podunk middle of nowhere Montana, which I can use because that's my home state, downtown, there you go. I mean, you know, it is your reputation and I think it's everything. To try to resurrect that, I mean, we see with celebrities all the time, right? It is so incredibly difficult to get that brand back when it is your brand and your image. It's just not worth playing.

Steve Wisocky (34:39.125)

Yeah.

Steve Wisocky (34:43.786)

Yep. Allentown, Pennsylvania. Yep, go ahead.

Katie (35:02.871)

playing Russian roulette with? No, especially for 20 bucks a month if you're just starting out, just saying. OK, great conversation. Thank you, Steve. So glad the little girl wasn't hurt. Thanks for bringing this topic to life for us, making it real, but also making it doable financially, and then just from an understanding perspective. What a great conversation. Thank you for your time.

Steve Wisocky (35:03.562)

No, it's not worth it. Not worth it. Yeah.

There you go.

Terrific.

Steve Wisocky (35:18.626)

There you go.

Steve Wisocky (35:23.862)

Thanks, Katie. Thanks for having me. Anytime.

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