incorporated....

Discussion in 'Business Operations' started by bobbygedd, Dec 2, 2004.

  1. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    can you be incorporated, if you have no liability insurence? the idiot that lives down the street carries no insurence, but says, "it's ok, they can't touch me, i'm incorporated."
     
  2. trying 2b organic

    trying 2b organic LawnSite Senior Member
    Posts: 566

    huh, I never thought of that. I think its true but they can still take the whole business. As you know being incorporated will just keep his personal assets like house etc out of the hands of creditors, even in the case of a million dollar liability. He would lose the equipment, the name, everything. He could start up under a new name the next day using his savings, the profits he as a shareholder removed from the company, or what he took as salary. Neat idea but most would prefer to protect the biz and ones home by having insurance.
     
  3. Flex-Deck

    Flex-Deck LawnSite Silver Member
    Posts: 2,846

    bobby- have no clue - I am incorporated, have insurance, the whole ball of wax. I would guess they are trying to think the corporation will fend off all law-suits - but I would guess they are officers, and they will eventually come after them?

    Thanks Brad
     
  4. naturescaretaker

    naturescaretaker LawnSite Senior Member
    Posts: 851


    In all states you can be incorporated without insurance. However, to obtain a business license... depending on where you are, that is an entirely different topic.

    An example is that SC does not require insurance to incorporate although they require an attorney do it. Can't incorporate a business yourself. For the city of Myrtle Beach we are not required to have insurance. But in Surfside Beach (next town down 5 miles) we have to have insurance to get a business license.
     
  5. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    He's an idiot first of all.

    Yes, you can still be sued personally even if you are incorporated in some instances of extreme neglect or ignorance of the law. The term is called, "piercing the corporate vale". If that guy bobby knowlingly ran over something with his mower and killed someone as a result, you can damn well believe it will NOT matter how his business is organized. The attorneys will come after him like hyenas chasing a meat wagon.

    No one is immune from a lawsuit these days, period.
     
  6. karen1122

    karen1122 LawnSite Member
    Posts: 69

    In addition to Rodfather's comments - You will have to hold your ears to survive the laughter barrage if you try to get a business loan without insurance. Additionally, many banks are even requiring private firms to adhere to Sarbanes-Oxley.
     
  7. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    Karen, what is that? I know I have heard it...
     
  8. bobbygedd

    bobbygedd LawnSite Fanatic
    from NJ
    Posts: 10,178

    well, the thing with this guy....20 yrs in business, everything bought cash, house willed to him, no wife, no kids, strictly cash business. has no respect for anything or anybody. he makes me....look like an alter boy
     
  9. karen1122

    karen1122 LawnSite Member
    Posts: 69

    Rodfather,

    Sarbanes-Oxly Act is the 2002 law that effects how public organizations and accounting firms deal with Corporate Governance and Financial Disclosure. This was the response to corporate collapses a few years ago. One part of the law is that corporate officers, management and independent auditors are now more personally responsible for their actions.

    It was intended for public companies, however, some if it is spilling over into the private sector, specifically banking.
     
  10. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    Gotta be as a result of the Enron scandal...thanks Karen :)
     

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