Starting a business specializing in portraiture

Started Jan 24, 2014 | Discussions thread
Joe Pa Senior Member • Posts: 1,839
Re: Let's create a Semi-Pro Forum

tcg550 wrote:

Joe Pa wrote:

As for liability insurance, understand that insurance (at least in the US) doesn't protect you from getting sued, it mitigates your risk if you are sued. You could have insurance coverage of $1 million dollars ($1M) but someone could sue you for $10 million, in which case you're still screwed.

I won't speak for others, but my belief is the insurance industry is a scam / Ponzi scheme. Insurance companies will encourage you to carry maximum amounts of coverage so they can charge you higher premiums. Most businesses carry a liability policy of $250K - $500K when they start out, if $1M umbrella coverage isn't significantly more then you might consider it.

The best insurance is to do your best to avoid situations where you could be liable for someone getting hurt. Don't drive your models, arrange to meet them. Don't leave wires, equipment, ladders in places where the public might trip over them.

I've never been sued, no one I know has ever been sued, but many on here will still make it seem like this is a major threat, reality is it's not likely to happen but you should be prepared in case it does.

I am not an attorney and do not play one on tv but if your a corporation, which is easy to set up, and keep business expenses separate from personal and you do get sued for more than your insurance your corporation may be screwed but your personal assets should be safe.

In my case I'm an LLC operating as an S corp. In my experience it makes bookkeeping easier but you must be able to keep personal and business expenses separate. In other words don't buy groceries with the company check book and claim it's a business expense.

I have been in business for 25 years and have never been sued.

Of course I have no idea how it works in other countries.

I am not a lawyer either, though after 15 years in business I've become very familiar with contract and business law.  I've been advised by two law firms that LLC and S Corps do offer protection to the owners personal assets, but you have to be careful of loopholes that lawyers will look for to gain reach into your personal accounts.

For example, a ladder - you may have purchased personally for work around the house that you decide to take on a shoot collapses.  The fact the ladder was not owned by the business, but by you personally could be an in for an aggressive lawyer.

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