Posts Tagged "self-employed liability insurance"

Insurance Planning for Your Home-Based Business

Posted by on May 20, 2015 in News | 0 comments

For many, achieving the American dream comes with the freedom of operating a home-based business. But without proper insurance planning, even the most promising dream can quickly turn into a nightmare. Blurring the lines between home and work can have unexpected and costly impacts on all types of personal insurance, says the National Association of Insurance Commissioners (NAIC). To avoid costly impacts, the NAIC recommends home-based business owners consider these personal insurance implications: Home – Homeowners’ or renters’ insurance policies are rarely adequate for business needs. Owners may want to investigate a business owners’ policy or general liability, business property and business interruption/continuation insurance. Auto – If you own or lease a vehicle almost exclusively for business use, list the business name as the principal insured. Consider also increasing coverage to protect permanently attached items, such as a generator or storage unit. Health – There are a variety of sources for purchasing HMOs, PPOs, EPOs and other popular health insurance plans at group rates. Under the Patient Protection and Affordable Care Act (ACA), business owners and the self-employed who purchase coverage through new health insurance marketplaces may qualify for tax credits. Life – If the home business is a partnership, consider key person life insurance which names each partner in a business as beneficiary on the other partner’s policy. If one partner passes away, the other can use funds to buy out heirs, pay off loans or continue operations....

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Why You Need Insurance as a Self-Employed Consultant

Posted by on Mar 25, 2015 in News | 0 comments

Do you work from home as a self-employed consultant? Do you believe that you really don’t need insurance at all or that your homeowners insurance will protect you from your business exposure? The fact is, you still have business liability exposures associated with your line of work – even if you work from home. I know a lot of self-employed consultants who feel they do not need insurance. In fact, most of them believe that their homeowners insurance will cover them. While it does cover property such as computers, it does not cover business liability! Unless it’s required by a contract, in general, self-employed consultants don’t get business insurance.  And those coverage’s requested can vary depending on the contract. At a minimum a self-employed consultant should carry general liability, auto liability, workers compensation, and a professional liability policy.  An errors and omissions liability or professional liability is a consultant’s primary business exposure. Depending on the nature of the business larger contracts will also require a consultant to carry an umbrella liability policy and set higher limits on the professional liability policy. So what’s the reason behind requiring subcontractors to carry insurance? To transfer risk; they need to know that their subcontractors insurance will cover any losses caused by the subcontractor  – and – subcontractors are required to pick up the liability of the company requesting the insurance in larger contracts. Most sole proprietor consultants can get a basic foundation of commercial insurance for about $1000 per year as a rule of thumb. Depending on the kind of consulting, adding professional liability or excess liability will increase this cost by another $1,000 to $2,500. I recommend that the limits be negotiated up front in an effort to reduce the cost of risk to all our business customers. An honest discussion about kinds and amounts of insurance is healthy when requiring a consultant with $200,000 – $300,000 of revenue to carry $3 mm or $5 million worth of liability insurance and these excessively high limits may be difficult to obtain from any insurance carrier. Having access to multiple insurance companies is always a plus. At Harned Insurance we have several companies hungry for this kind of business so we can offer good options at the lowest possible cost. Do not hesitate to contact me if you have insurance questions or are in need of...

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