Business Insurance or Do the LLC

Discussion in 'Business Operations' started by mownitup, Mar 24, 2004.

  1. mownitup

    mownitup LawnSite Member
    Messages: 14

    Which will be cheaper and or better, getting Business insurance or doing the LLC thing over the internet?

    I've gotten one quote on Business insurance and they are wanting to charge me @ $650 per year. If I do the LLC thing over the internet it's going to cost me @ $250?

    Speaking with my Accountant I was told to do the Sole Proprietor
    verses the LLC because it would be cheaper on me tax wise and I could file my business along with my personal taxes!
  2. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Messages: 1,912

    I'd get a new accountant

    But what does having insurance and having an LLC or even sole proprietor as business structure have to do with each other

    Either way as an LLC or sole prop you expose your self to being sued without insurance to cover damages

    I'm an S corp which gives me limited personal liability as far as being sued myself .... has great tax advantages .... gives me perks as an officer of the corp (company truck, phone and other "gifts" from the company)

    Having insurance is just protection from damages one may create as an S corp, LLC or even solo .... one should have it
  3. Hawkeye5

    Hawkeye5 LawnSite Senior Member
    Messages: 295

    Choice of business organization (Corp., LLC, Partnership, Sole Proprietor) has no impact on the need for insurance. It is irresponsible and foolish to operate any business without providing for potential legal liability to others and to protect assets.
  4. Scraper

    Scraper LawnSite Bronze Member
    Messages: 1,656

    Exactly...just because your LLC does not negate the ned for insurance. Either way, a person is going to hit your insurance. Only difference is LLC may protect you from them going after your "personal" assets (i.e. house, car, furniture) as opposed to your business assets (i.e. mower, aerator, truck)
  5. mtdman

    mtdman LawnSite Gold Member
    Messages: 3,143

    A single member LLC files as a sole proprietor, there would be no difference. Being an LLC does not negate the need for insurance.
  6. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Messages: 4,040

  7. DJL

    DJL LawnSite Member
    Messages: 237

    either you need to get a new accountant or you are asking the wrong questions!

    you need to get this straight. Whether you are a sole proprietor, LLc, LLP, C-Corporation, whatever, you still should get insurance.

    the other thing I'd look at is this...

    DON'T quote me on this but...

    let's say you get sued for running over poor ol' aunt millie with your mower. She sues your company and is granted two million by the courts. Now, let's say you had a one million insurance policy, fine paid the first million. But now YOU are responsible for paying the rest from your company. Let's say your company doesn't have the money. You wind up selling everything in the business until you can pay her. Can't, they will go after you personally. an LLC they can only go after the assets in the business, NOT your personal assets, LIKE YOUR HOME!! Of course, this scenario is dependent if you ran your business as just that, a separate entity from your personal. But that's another story. Oh ya, and if you had insurance chances are the insurance would settle with Aunt Millie before going to court.

    Just my two cents.
  8. Zito

    Zito LawnSite Member
    Messages: 40

    I was told that if you have insurance, then the underwriter would provide the lawyers, which could cost a small fortune.

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