I recently formed an LLC in Illinois and was looking for commercial liability and workers comp policies. Since I want to do some light rehabs, several agents have told me I would have to be classified as a general contractor which increases the premium costs greatly. I plan to hire a gc to do the work. State Farm and Allstate won’t touch me. Does this sound right to other rehabers? Can anyone provide a referral for some national carriers with reasonable premiums?
Business insurance is not suitable for your situation (IMHO). You are going to spend a ton of money and not get anything out of it. Carry some personal liability and let the LLC be your liability shield; that’s its job
agents like to sell insurance. worker’s comp? you don’t have employees.
look for a builder’s risk policy. covers structure, tools, etc while the rehab is taking place. together with a general liability should be all you need.
I got my coverage from the company that handles my homeowner’s and landlord’s policies. the insurance is underwritten by a different company (scottsdale casualty??) , but nationwide handled all the paperwork, etc.
gp, sounds like your loading up the wagon and don’t have a map to get to where you’re going.
S L O W D O W N
what you’ll find is many insurance companies, well all of them, give insurance in a very categorized manner. they have everything segmented into little neat spaces. you don’t fit one per se, so they’ll scratch their head and wonder how they can help you.
the ISSUE HERE IS, you do not have a business plan to present to them. i think alot of people downplay, especially in rei, the need for a formal business plan. it doesn’t have to be 30 pages long, but it should be written down that you have goals, financing, leadership and a mission.
do this, present it to an insurance carrier, bank, lender, broker, whomever (of course don’t give away trade secrets in the business plan - i’m sure you won’t have to worry about that).
they still might review it and scratch their head and say…hmmm…but then it comes down to their underwriting and taking a look at their policies…the exact name of this portion of their policy escapes me at the moment, but it requires the insurance carrier to take a look at their policy and coming up with a coverage that matches your business goals, while also not extending the insurance carrier into any risky, illegal or stupid coverage agreements.
Thank you all for your advice!