Some Tennesseans are taking advantage of the state’s agricultural opportunities. They’re making and selling salsas, jellies, apple butter and other value-added foods. If you decide to join them, be sure to talk about insurance coverage with your agent.

Some people don’t think about insurance until someone they want to do business with requires it, disaster strikes or they find themselves in a lawsuit.

You may want to check out “food-product liability” coverage. This provides some protection if your food product causes injury to the user. Most stores that might sell your product require at least $1 million in product liability insurance before they will put it on their shelves.

Many local insurance agencies don’t offer food product liability insurance, but they may be able to arrange for such coverage. When you find a carrier, you’ll need to provide information about annual sales, annual payroll and other specifics of your business for the carrier to figure a premium quote.

How much will it cost? A rule of thumb is that the premium for a $1 million policy will be $1,000 annually. But sometimes rules of thumb can be a long way from reality.

To get a quote, most companies that provide food-product liability insurance require a completed application and the submission of the business’ production, distribution and marketing plans. Gross sales and previous claims against your company play a major role in determining your annual premium.

A survey last year found that food-product liability coverage ranged from $500-$20,000. The average premium was $3,000.

What things contributed most to the annual premium? The survey found that these things were gross sales or annual payroll, prior claims and the level of coverage needed.