I JUST INCORPORATED A SMALL BUSINESS,
WHERE I AM THE ONLY EMPLOYEE/OWNER.
AM I REQUIRED TO HAVE/PURCHASE LIABILITY INSURANCE?
ACCOUNTANT SAYS NO,
CUSTOMER SAY OTHERWISE.
PLEASE HELP.
GENERAL LIABILITY INSURANCE REQUIREMENTS
Started by
METRO32168
, Feb 21 2013 07:54 AM
3 replies to this topic
#2
adjusterjack
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Posted 21 February 2013 - 09:11 AM
Your accountant is right. You have no obligation to purchase liability insurance. Though you'd be a fool not to have it.
However, your customers are your bosses. If your customer won't do business with you if you don't have the insurance then you buy the insurance if you want to do business with that customer.
If you are in some sort of service business where you do work for people at their homes or businesses or you work on their belongings at your own location, many of your customers are going to want you to provided evidence of insurance.
My advice: If you want to make a success out of your business buy the insurance.
If you are satisfied working fly-by-night for peanuts for people who don't care, that's your choice.
Or if you don't care about being driven into bankruptcy by a lawsuit, that's also your choice.
However, your customers are your bosses. If your customer won't do business with you if you don't have the insurance then you buy the insurance if you want to do business with that customer.
If you are in some sort of service business where you do work for people at their homes or businesses or you work on their belongings at your own location, many of your customers are going to want you to provided evidence of insurance.
My advice: If you want to make a success out of your business buy the insurance.
If you are satisfied working fly-by-night for peanuts for people who don't care, that's your choice.
Or if you don't care about being driven into bankruptcy by a lawsuit, that's also your choice.
Warning: Legal issues are complicated. Explanations and comments here are simplified and might not fully explain the ramifications of your particular issue. I am not a lawyer. I do not give legal advice. I make comments based on my knowledge and experience. I guarantee nothing. If you act on my comments without the advice of an attorney, you do so at your own risk.
#3
FindLaw_AHK
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Platinum Contributor
Posted 21 February 2013 - 09:31 AM
You may be interested in visiting the Small Business Law Center and reading Business Liability and Insurance as a good resource to learn more about this subject matter.
#4
pg1067
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Platinum Contributor
Posted 21 February 2013 - 10:35 AM
Please turn off the caps lock key.
What sort of business does your corporation do? In what state does it do business? Legal requirements may indeed exist, but we cannot know without knowing these things.
There are also a number of areas in which general liability insurance is required by contract as a matter of custom. For example, general contractors typically require their subcontractors to carry such coverage.
And I agree that you'd likely be very foolish not to carry such coverage.
What sort of business does your corporation do? In what state does it do business? Legal requirements may indeed exist, but we cannot know without knowing these things.
There are also a number of areas in which general liability insurance is required by contract as a matter of custom. For example, general contractors typically require their subcontractors to carry such coverage.
And I agree that you'd likely be very foolish not to carry such coverage.
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