Business/liability insurance recommendations?

[Fallon]

I'm looking at starting up a side gig doing some tractor work. Obviously I need do do a fair bit of research on various stuff, including insurance. At some point here I'll be talking to a lawyer and/or tax advisor/accountant. This will never be more profitable than my day job as an IT security engineer that I enjoy, so it will always be a side hobby gig.

Pretty sure I've got my operating costs & then rates to charge nailed down other than liability insurance.

Anybody have any recommendations for a good insurance company to talk to or policy types & amounts? I'm assuming it will be a landscaping type policy as I won't be doing anything deeper than tilling or light grading.

Looking for some info & research vectors to dig into so I'm better informed when I talk to the professional advisors down the road.

At the moment I'm think about sole propiter rather than LLC. Less burecracy needed & if you don't keep up on it right, you loose the LLC legal protections. And proper insurance coverage should mostly cover potential liability there.

 

[smstonypoint]

I think that you will find that rates differ across states. IMO, your best option is to talk to several independent agents to get a handle on the rates in your area.

Steve

 

[TheMan419]

Find a good local agent. Tell them what you want to do and have them guide you as to the insurance policy you need.

 

[Tractor Seabee]

Most states require a business license and tax license. States like WA where I am also require you to have a contractor's license if you charge by the job. Plus there are county and cities to also that have such laws in addition. I found my accountant knew more about such things than my lawyer.

Ron

 

[radioman]

you need to start making phone calls/footwork. For me, I went into my local insurance agent that handled my home and cars insurance and told them my intentions. she stated she doesnt offer coverage but will find someone who would write policy for me as handyman . getting insurance as handyman is much harder then a specific trade. My insurance sent me a "survey" wanting to know more in depth like how deep am i digging with what with what percentage of work i do. its so ridiculous.

 

[Fallon]

you need to start making phone calls/footwork. For me, I went into my local insurance agent that handled my home and cars insurance and told them my intentions. she stated she doesnt offer coverage

Yup & yup. Trying to gather some info from the brain trust so I know what questions to ask when doing the footwork.

My homeowners agent said he'd look into it for me a few weeks ago. Havent heard a single followup. I'm thinking I'll check out new homeowners & auto insurance while I'm at it.

 

[Complete Turf Care]

As others have said, visit a few agents and get quotes. Several years ago I needed some additional coverage for a job I wanted to do, so I called my regular insurance agent (who was a college roommate of mine). With his quote, my rate was going to go from about $7000 up to about $12,000 a year.

I went to another agent and got the coverage I needed for about $8000 a year. My point is......it pays to shop around for insurance.

 

[Bavarian]

You have some experience in pricing already. This might make you careful already since you know that the reality is way more expensive as you first thought.

For a rookie, I would say, calculate your number and add 50%. In your case, I would say 30% would be a good number.

You might not miss as many expenses in your upfront calculation than a rookie might miss.

Good luck

 

[Citydude]

I did the same thing your doing a couple of years ago. It's best to set up your LLC or sole proprietor with an attorney first. After that is established, talk liability insurance with a couple of agents in Parker. My local insurance agency that deals in business insurance set me up with Marine Life for business liability. I paid around $1700.00 per year if I remember right. If I had employees, the costs would have went up but I never hired an employee.

And last but not least, your business will need to have an IRS employer identification number (EIN). Yes, it's important. your accountant will very much appreciate having this. have fun on your new adventure!

 

[Tractor Seabee]

With the scope of work you are contemplating I would leave the lawyer out of the mix. Stay with an LLC or S Corp and you do not need Articles of Incorporation. Your accountant should be able to do that and get you TIN from IRS in the corporate name. Any thing involving machinery of cutting implements ups your liability quick. Its amazing what it costs to fix water main, gas line, or power line after you have dug it up. Minimum recommendation is usually $1M, liability + $ 500K property damage.

My Accountant advised me to set up a payroll for my self and any casual helper labor. For your kind of work it is illegal to call employees "independent contractor". Never hire under the counter as there is no way to account the cost and you liability carrier will go nuts and cancel you in a heartbeat. There is probably a clause that will allow them to disallow a claim. Cover your self with your state L & I so an accident on your side job won't bankrupt you. That is one of the first question when you hit the ER. "who is paying". You may be glad years down the road that you paid the extra SS when calculating your average earnings and credible years.

Be sure and check the license stuff I stated in my previous post

LOL, Ron