Insurance question

**Newdetailer1** · 04-12-2012, 09:59 PM

How much coverage do you guys carry? This would just be for myself. I'm a sole proprietor and have no employees. I work out of my personal garage on weekends and I'm really not high volume. I would just like to cover myself just incase some should happen. I got quotes for 30, 40 and 50K for comprehensive and 500K for general liability. Which seems reasonable to go with?

**Mobile detail** · 04-13-2012, 01:14 AM

Is your house and retirement in a trust? If you get sued can you lose your house? Insurance is great, but if you can still lose yor stuff than you need to address that first. If your only doing this part time do you rally need insurance ? How many cars are you planning on doing? Unless your doing lambos, how much damage do you think detailing will cause?
What's the worst that could happen? Do you drive the cars?

**Newdetailer1** · 04-13-2012, 05:45 AM

Originally Posted by Mobile detail

Is your house and retirement in a trust? If you get sued can you lose your house? Insurance is great, but if you can still lose yor stuff than you need to address that first. If your only doing this part time do you rally need insurance ? How many cars are you planning on doing? Unless your doing lambos, how much damage do you think detailing will cause?
What's the worst that could happen? Do you drive the cars?

Thats why I'm here asking what everybody else does or would do. Cause I'm not sure what is best or necessary?

**Tundra_10** · 04-13-2012, 06:03 AM

I might seem like a cynic but in my eyes its best to er on the side of safety and over insure yourself. I would also suggest forming a LLC so that if you do get sued, it would only effect the business and not you personally. You can always change your limits so what I would suggest if I were you is maybe get enough to cover 150-200% of the most expensive vehicle you think you will be detailing. That way, worst case scenario if you somehow manage to destroy the car you have some wiggle room when the plaintiff tries to come at you with "pain and suffering" or "wage loss" or "inconvenience" im sure the right lawyer can think of a lot of creativity to get more money out of you.

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**BMW** · 04-13-2012, 08:38 AM

Originally Posted by Tundra_10

I might seem like a cynic but in my eyes its best to er on the side of safety and over insure yourself. I would also suggest forming a LLC so that if you do get sued, it would only effect the business and not you personally. You can always change your limits so what I would suggest if I were you is maybe get enough to cover 150-200% of the most expensive vehicle you think you will be detailing. That way, worst case scenario if you somehow manage to destroy the car you have some wiggle room when the plaintiff tries to come at you with "pain and suffering" or "wage loss" or "inconvenience" im sure the right lawyer can think of a lot of creativity to get more money out of you.

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Tundra 10 is correct...pursue becoming an LLC. They are inexpensive and easy to set up...and their very name implies their purpose "Limited Liability Corporation"

**FUNX650** · 04-13-2012, 08:43 AM

Originally Posted by Newdetailer1

How much coverage do you guys carry? This would just be for myself. I'm a sole proprietor and have no employees. I work out of my personal garage on weekends and I'm really not high volume. I would just like to cover myself just incase some should happen. I got quotes for 30, 40 and 50K for comprehensive and 500K for general liability. Which seems reasonable to go with?

A PM to AGO Forum member Bacon, soliciting his advice in this matter, could will-out to be most beneficial. (Insurance is his forte!)

Bob

**tkendrick** · 04-13-2012, 09:37 AM

Newdetailer1,

I happen to be a property and casualty agent in Texas. Clearly, you haven't provided enough information to give specific advice, however I can maybe give you some general advice.

First, find an independent agent in your area. Call and ask if you could come in and talk about your business. Be prepared to give detailed information about your business plans.(ie: what is the scope of your work, type of vehicles you work on, where you work on them, equipment used, do you keep them overnight...you get the idea)

You should look at your meeting as an interview. Your agent should explain what coverages you need and why, provide multiply quotes and answer all of your questions. You should look to him as a business asset. Your hiring him and he's not doing you a favor to give you a quote.

Second, meet with an attorney about setting up an LLC. He will explain how to protect your personal assets should you have a lawsuit above the limits of your insurance coverage. I'm not going to give legal advice, but I do know an LLC doesn't protect from personal financial damage unless you act as a corporation. A good attorney can pierce a corporate veil if you are acting as a sole proprietorship. In most states your home can't be attached via lawsuit. Your retirement accounts are not at risk of a personal suit. However, that doesn't mean other personal assets would be at risk.

Your attorney will make sure to explain your exposure and how to protect your assets.

Lastly, I would suggest sitting down with a good CPA. They will advise you how to manage your business and taxes. You should look to these individuals as your business team.

Hope this helps.

**Porsche Pilot** · 04-13-2012, 09:41 AM

Very sound advice from Mr. Kendrick. I always appreciate his input since he is in the business. Bottom line is to get yourself covered. I am the spouse of an attorney and let me tell ya, they can smell a lawsuit through a stack of rotten fish.