Insurance

[Rtodd79]

Starting my own small tree business as a side business. Plan is to do small removal and pruning jobs in NC maybe 1 job a week. Nothing to risky as it will be mostly myself and 1 more person. I have medical insurance through my full time job, my question is about liability insurance and how much and should I get any at all. Thanks in advance for any input.

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[Ted Jenkins]

The issue is if you want to get licensed or not. No license no insurance. You will have to get workers comp period. The good thing is you will not have to pay full time benefits. Thanks

 

[Rtodd79]

Wasn't planning on getting licensed right now. Maybe in the future. Just trying this out right now and seeing where it goes. Again this is a side business and not a sole means of income. I just want it to be as legitimate as it needs to be.

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[Ryan'smilling]

The issue is if you want to get licensed or not. No license no insurance. You will have to get workers comp period. The good thing is you will not have to pay full time benefits. Thanks

I think they'll sell you insurance regardless of what other paperwork you do or don't have.

 

[Rtodd79]

I'm not licensed but i have an insurance quote for $2 mill worth of coverage for $800 down and $100 a month. I understand things can happen but i don't plan on taking any jobs that could possibly cause that much damage. I'm a firm believer in better to have it and not need it than to need and not have but I'm just questioning whether I need that much or any at all for what I'm going to be doing. I do have an established LLC to protect my personal interests if that makes any difference.

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[CacaoBoy]

Wasn't planning on getting licensed right now. Maybe in the future. Just trying this out right now and seeing where it goes. Again this is a side business and not a sole means of income. I just want it to be as legitimate as it needs to be.

If something goes wrong and you are sued without insurance, are you judgement proof? Or do you have a bank account, or investments, or own real estate or a vehicle? If you have non-exempt assets, those might be lost.

I'm not licensed but i have an insurance quote for $2 mill worth of coverage for $800 down and $100 a month. I understand things can happen but i don't plan on taking any jobs that could possibly cause that much damage. I'm a firm believer in better to have it and not need it than to need and not have but I'm just questioning whether I need that much or any at all for what I'm going to be doing. I do have an established LLC to protect my personal interests if that makes any difference.

Bear in mind that a benefit of liability insurance is not only that it will pay for damage or injuries for which you are responsible, it also will pay the attorney fees to defend you against a claim, including frivolous claims.

While you may not foresee potential damages of any large amount, consider the possibility that some fool walks toward you while you are working, and a wood chip flies and blinds them in one eye. Unlikely? Yes. Possible? I worry about unlikely but possible events. How much is an eye worth?

You have the LLC to protect your personal assets, but would it be effective, or would a court allow a plaintiff to pierce the corporate veil and hold you personally liable? If you would be unlicensed and without insurance or substantial corporate assets there may be two strikes against you. Lots of people lack the discipline to keep personal and LLC assets separate and to keep proper records, which can make the protections of the LLC worthless.

You seem to be in a tough spot. The cost you were quoted for insurance may be more than your income would be from this work. Cutting back to $1M would probably save something, but perhaps not much.

 

[old CB]

Where I live and work--in the county, not in town--I don't need a license. I also don't do ISA certification--it looks good, and might up your marketability, but ultimately your reputation will come from the work you do, and not those three expensive letters after your name.

Can't remember offhand, but my commercial liability ins. runs around $1200--1300/year. For a $2 million/$1 million per occurrence policy. I've never needed it, and expect never to use it, but I wouldn't be without it. Anyone who's never F--ed up in this business is a liar or hasn't worked long enough. Just the peace of mind of knowing that you're covered for that freak accident is worth something. Plus, many clients just won't hire you if you're not insured.

The LLC thing is good, but Cacaoboy is right--the least little inattention to how you own something or pay some bill could provide an attorney with the means to take you down.

I also do Workmans Comp for my one employee. Again, I expect never to need/use it. But if someone ever gets injured on your payroll, your worst nightmares can begin. No matter how careful you are, **** happens. Not to mention that if you have a good friend and employee (as I've had the good fortune), you both are now in a very awkward situation if there's not insurance $ to make things right.

 

[Ted Jenkins]

Here you can not do much without a license. I have a license for tree removal and for timber harvest. In order for me to activate those licenses I must have a insurance policy in place. It is a big fine and several years of jail to contract with out a license. If you want to test the waters then by all means give it a try. If all you need is some sort of insurance in place then see how you like it. Thanks

 

[benjo75]

2 million sounds like a lot but it's really not. That's how much I carry. It's only about $100 more per year than 1 million. It's not for the random fence or shingle that might get broken, it's for the school bus full of kids that gets a broken window and glass everywhere or the buried electrical or gas line or the fiber optic system that goes to the hospital 3 miles down the road or any other random one in a million accident that you would never think of.

 

[Arbomeister]

I'm not licensed but i have an insurance quote for $2 mill worth of coverage for $800 down and $100 a month. I understand things can happen but i don't plan on taking any jobs that could possibly cause that much damage. I'm a firm believer in better to have it and not need it than to need and not have but I'm just questioning whether I need that much or any at all for what I'm going to be doing. I do have an established LLC to protect my personal interests if that makes any difference.

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Make sure that your insurance is not capped - i.e to trees no taller than 60ft. I have noticed some of the cheaper insurance has started to do that. The other thing cheaper insurance lacks is the cover to ‘fell’ trees. It just covers ‘trimming’. Games...


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[old CB]

It's also worth mentioning that you can probably save $ by not going the $X-per-month route. I pay my ins. bill (and all else) in one lump sum when the bill comes in. You're paying a hefty bit of interest otherwise.

 

[Rush]

My advice to anyone when discussing insurance coverage (especially when related to liability coverage) is to READ IT and have a complete understanding of everything that is covered & more importantly, everything that is NOT covered. Have a personal face to face conversation with your agent and ask them to explain it to you in plain language. Heck, try to get it in writing from them by emailing them a list of scenarios with a yes or no to each one.
Over the years I have known people (small companies) who had "coverage" but when something happened, guess what....their situation wasn't specifically "covered". Some insurance companies will do everything they can to try to get out of paying.
CacaoBoy makes great points above. I have also seen them decline to provide legal defense under certain circumstances.
Whatever route you take, PLEASE do not work without insurance....you could lose everything. Just my 2 cents...

 

[Nathanael G South]

I'm not licensed but i have an insurance quote for $2 mill worth of coverage for $800 down and $100 a month. I understand things can happen but i don't plan on taking any jobs that could possibly cause that much damage. I'm a firm believer in better to have it and not need it than to need and not have but I'm just questioning whether I need that much or any at all for what I'm going to be doing. I do have an established LLC to protect my personal interests if that makes any difference.

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Who quoted you for that? Just curious. I'm looking for coverage too.

 

[Rtodd79]

This was my quote.

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[Nathanael G South]

This was my quote.

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Ok thank you. I will try them.