# liability insurance



## mcoyfrog (Jul 23, 2008)

Hey all

So I'm considering a bunch of contract work for installing cabinets for a local shop here and they need me to carry liability insurance does anyone out there have any thoughts on this. I've done a lot of work through the years but never had to worry about this. What are the costs, what should I look for, what coverage types are there, what coverage types are unnecessary etc.

Any help/ideas would be most appreciated.

Thanks


----------



## TopamaxSurvivor (May 2, 2008)

See an insurance broker that handles commercial and contractors.


----------



## Sawkerf (Dec 31, 2009)

If your state requires licenses, they probably require some minimum levels of liability insurance and bond. Your state gov't website should have the requirements.

Cost will depend on what coverage you carry.

You might ask the cab shop who carries their liability and talk to them.


----------



## waho6o9 (May 6, 2011)

Is this a 1099 type of employment?
Who is responsible for worker's compensation?
If the cabinets are the wrong size, are you expected to cut them on the job, bring them back,
make it work or whatever?
Be careful and good luck my friend.


----------



## thedude50 (Aug 13, 2011)

when i used to install cabinets back in the day i added a liability rider for 100k on my business insurance..as i recall it cost like 50 dollars a month on my 500 dollar a month business policy. the big expense was workers compensation.i think for the 5 guys in the shop that was pricey but I was in California and you have to Cary lots of insurance.

one thing i remember my agent told me make sure you keep your deductible low and buy twice as much as you think you are going to need


----------



## Domer (Mar 8, 2009)

I agree with all of the above. You should talk to an insurance broker about the coverage you need.

At a minimum you need liability insurance which should be fairly inexpensive. What if someone trips on something at a job site and gets hurt? You would most likely be responsible.

If you have employees, most states require you to carry workers compensation to cover the cost of medical expenses if one of your workers gets hurt on the job. If you are a subcontractor, most general contractors will require you to provide proof of workers compensation as they are liable if you do not carry it.

Unfortunately, it is a cost of doing business.

Domer


----------



## tenontim (Feb 24, 2008)

If the cost of the insurance is out of your budget, see if you can get the cabinet shop to let you just build the cabinets and have them install them. That way you can build them in your shop and not have to do any work at the site. If they need to sub contract work, any help they can get should help them out.


----------



## ssnvet (Jan 10, 2012)

Long ago I did a little light excavation gig on the side and worked directly for home owners or small landscapers. When one of them did an complete re-landscape job for a medical office, I had to show proof of liability insurance to work on the site as a subcontractor. The policy was ~$200 for six months… but his was in back in '89.

My current employer runs an architectural millwork company as a wholey owned subsidiary, and when we use subs for installations (which isn't very often) we have to show the customer their proof of liability insurance. If the sub has employees, they can't go after us for workers comp. claims… only their employer (who is required to carry workers comp. insurance by law).


----------



## mcoyfrog (Jul 23, 2008)

Thanks guys for all the comments

I have a call in with a insurance broker and I"m finding out all the in's and out's I'll hopfully have something b4 next week.

waho6o9 yup 1099 type stuff they will give me a certain amount per box for the install, if cabinets are wrong its on them, I used to work for them years ago as an employee so I trust them but of course it will all be in writing.

thedude50 thanks for the info, thats what i heard also twice as much, and It will just be me so no employees to worry about

anyway thanks again for all the responses can't wait to get started with the work, seems like the last 3 years i'm always in a scramble to keep work on my plate LOL


----------



## crashn (Aug 26, 2011)

My general liability insurance (through The Hartford) is about 600 a year, or 50 a month.


----------



## tncraftsman (Oct 21, 2009)

At a minimum you will need a commercial general liability policy.

Not essential but you may need a commercial rider on your work vehicle. Your current auto insurer should be able to do this for you without having a different agent.

Workers comp varies by state. I believe mine has an exemption for a 1 person shop though you still have to pay a fee. Others may mandate WC on a 1 person shop.

They want you to have this so should you break something in the clients house it's a claim on your policy and not theirs. Essentially you are a subcontractor in this situation so make sure you are covered and the cost of acquiring insurance is worth it to you.


----------



## mcoyfrog (Jul 23, 2008)

All great info thanks a bunch I should have a quote from my insurance guy this week. Again thanks all for you help


----------



## thedude50 (Aug 13, 2011)

did you get your quote yet I am thinking of going pro again an am curious as to the rates that are available today.


----------



## Vrtigo1 (Mar 18, 2010)

My wife is an insurance agent. General liability isn't too bad. I had a policy a few years back when I had my own business doing IT stuff. As I recall it was about 750 a year. If you're using a personal vehicle check with your agent to see if you are okay using it for work purposes. I know a lot of insurance companies will deny claims if they found out you had a magnetic sign with a business name on your car because they classify that as business use. If you check your auto policy it probably specifically says that any commercial use of the vehicle is not covered. Just something else to think about.

Along the same lines, you may want to think about incorporating if you'll ever do business with anyone you don't trust 110%. It limits your personal liability. As a sole proprietorship you have full personal liability for anything the business does meaning if someone sues you they can go after your personal assets (car, house, savings, etc). Incorporating is not too expensive if you file the paperwork yourself.


----------



## MNgary (Oct 13, 2011)

Be aware when purchasing liability insurance there are two different types of coverage!

One type covers lawsuits filed while the policy is in effect and the other covers claims for work/responsibilities while the policy was in effect. I.e., the first covers lawsuits filed now and latter covers lawsuits brought forward for what you did back when the policy was active.


----------



## mcoyfrog (Jul 23, 2008)

the dude50 nope I was working a couple different leads for work and the one with the desk job came back the strongest so I start that job at the end of the month and won't be needing the insurance after all. It was going to be around $300 a year with just liability then work comp would have added anywhere from an extra $200-$400 per year on top of that depending on how long you have done that particular job, how much experience you have, etc etc.

vrtigo1 yup defiantly my biz is an LLC if ever it became any bigger in the revenue I will be stepping it up to the next level.

mngary funny you should mention that, In another biz venture of mine we are looking at closing it down and investigating what our options are in case something comes back in the future. We are pretty sure nothing would but just want to cover our bases mann the insurance biz is complicated LOL


----------

