Author Archives: Cindy Williams

LLC vs. Individual – Rental Property Owner

 LLC vs. Individual – Rental Property Ownermeter

Should you form an LLC if you own rental property? The decision to form an LLC is complicated and each landlord’s situation is different. The first LLC came into existence in the U.S. in 1977 in Wyoming, since then all 50 states have enacted LLC legislation.  Here are some pros and cons to  help you decide if an LLC is right for you.

PROS

  • Protect your personal assets from lawsuits: If someone sues you when set up as an LLC, your personal assets are protected. Only the LLC’s assets are at risk.
  • Pass-through taxation: Pass-through taxation is an IRS related ruling allowing LLC profits to be passed directly to the owner. Taxes are paid on by the individual, avoiding double taxation.
  • Easier management responsibilities: LLCs are much more easily managed than corporation or partnerships and many states offer reduced fees.

CONS

      • It costs money to set up an LLC: You can set up an LLC with the State Corporation Commission and pay a small fee. Many people choose to use an attorney or hire a services company. These options cost from a few hundred to a few thousand dollars.
        • Keep your money separate: It is important that you never mingle your LLC money with your personal money. The slightest infraction could cause a litigant to claim the LLC is not a separate entity, causing you to lose any LLC protection.
  • Mortgages can complicate: If you already have a rental dwelling with a mortgage on it, changing to an LLC could look like a sale to your mortgage company. If you have a due-on-sale clause in your mortgage it may cause the mortgage company to require payment in full.

 

The decision to form an LLC is complicated and each landlord’s situation is different. Consider the above information and consult with your CPA or attorney to see if an LLC benefits you. Then let the experts at Cobb-Hall provide insurance solutions designed specifically for your needs.

Dangers of a Personal Auto on a Business Policy

Dangers of a Personal Auto on a Business Policy 

Young Asian Engineer working with laptop computer while sitting on car trunk at parking lotWhile It is true that using a vehicle for business while insured on a personal policy could potentially void all coverage, there are also pitfalls insuring your personally owned and titled vehicle on your business policy. Consider the following:

  • If a vehicle is NOT titled in the company name, but the insurance coverage is in the business name, coverage can be denied. This includes both physical damage AND liability protection for you or others.
  • No-fault personal injury protection may not be included.
  • Coverage may not extend to other drivers
  • Liability protection might not follow you when driving vehicles other than your own the way a personal policy does. This can apply both when you borrow and rent a vehicle.

Depending on your specific situation, there are various ways to make sure you are not left financially vulnerable. The insurance professionals at Cobb-Hall may recommend one or more of the following:

  • Endorsements to your business policy are available to close gaps between business and personal insurance policies. These include “drive other car” and “hired and non-owned”.
  • It is best for family members in your household to have a personal policy instead of adding their car to the business policy.
  • Often a personal insurance policy, with multi-policy discounts, is more cost effective.
  • Many times legal gaps can be avoided by contracts and leasebacks. A professional can provide the needed forms to sign.

Contact  Cobb-Hall to help you with determine the best solution for you.

 

 

Essential Info. Renter Insurance

 Renter InsuranceI can't wait to unpack

Whether you are just moving in, or have rented for a while, Renter’s insurance is necessary and very affordable. Avoid financial hardship by examining the variety of coverages provided in a renter’s policy and choosing the right option for you. Here is a brief explanation to help you determine your need for protection.

.Personal Property – Renter insurance will cover loss of your personal property from many causes, including wind, fire, theft and vandalism. Personal property is commonly thought of as all the contents of your home.A simple way to think of this is to imagine turning your house upside down and shaking it, everything that falls out is considered contents.

Replacement Cost – We recommend you cover your contents for replacement cost versus actual cash value. The cost is not much more and provides you replacement value for items claimed rather than depreciated value. This can make a huge difference after a loss.  For example: if your sofa is destroyed in a fire, replacement cost on contents coverage would allow the company to reimburse you the cost of a new sofa.  Actual cash value coverage limits the company payment to the amount your old sofa was worth if you were to sell it.

Away from Premises – A percentage of your coverage also applies away from your home. This is important to know when traveling or normal daily activities take you away from home.

Valuables – You have the option to list (schedule) valuables on your policy. This provides coverage for almost ANY kind of damage including losing the item.   This is very affordable (usually under $2.00 per $1000 of value) and well worth considering. The most common items scheduled are jewelry (including engagement rings), computers, smart phones and other high value objects such as hearing aids.

Liability – Renter policies include coverage for defense cost and injury or damage to others if you are sued or determined to be legally liable. Examples include if your dog bites a neighbor or damage if your child breaks a friend’s expensive Chinese vase. Consider your assets when deciding on a liability limit; $500,000 sounds like a lot, but is very affordable and litigation is more expensive than most people consider.

Contact Cobb-Hall today to help you determine the insurance protection that best fits your needs.

Life Insurance – What Do You Need? How to Know

Dime

Life Insurance – How do you know what you need?

While life insurance is not fun, it may be necessary for the good of your family. One popular simple guide to help you decide how much life insurance you need uses the acronym “DIME”. Add these four categories together to help you determine the total amount of life insurance right for your family.

D – Debt   How much debt do you have? The amount you owe is passed on to your family.  This amount should also include funeral expenses as well as credit card, car payments and student loans

I – Income  One of the main purposes of life insurance is to provide your family with income. Many people multiply their yearly income by the number of years until their youngest child is 18.

M – Mortgage   The remaining balance of your mortgage loan should be included to make sure your family does not  face the hardship of losing their home.

E – Education   If you have children, include the cost for their college education. Figure a minimum of $100,000 for a four  year degree for a state school for tuition and dorm fees. The cost will be more if you are considering private or out-of-state schools.

There are a number of options for the type of Life insurance that best fits your needs. Two of the most popular are:

Term Life Insurance  Term life insurance covers you for a specific period of time, or term, that you choose. When the time period is over, it expires similar to an auto insurance policy. This can provide an inexpensive way to protect your beneficiaries.  Variations include guaranteed renewal plans or options to convert to another type of policy. It’s important to remember that rates generally increase along with the insured’s age.

Permanent Life Insurance  These policies provide a lifetime of coverage and build up cash value that remains available to the policyholder. Permanent policies include Universal and Whole Life Insurance. This is the most cost effective long-term option because of stable premiums and the availability to access money invested in the policy.

Many people benefit from a combination of Term Insurance to cover higher debt when they are young and Permanent Insurance to keep rates low with age. Contact the experts at Cobb-Hall Insurance to assist you with your decisions.

Equipment Breakdown

EquipmenIndustrial icont Breakdown

Whatever your business; from a freelance graphic designer with a computer set up worth thousands of dollars, to a manufacturer with millions of dollars worth of equipment, if your equipment breaks down your business may too.  When your computers, machines and other equipment work properly, your business runs smoothly. But when a vital piece of equipment breaks down, you’re stuck while the equipment or wiring is repaired or replaced. During that time, you may have to pay for servicing and lose revenue while your business cannot operate. The costs can be huge. Equipment Breakdown Insurance is a necessity in this technological age. You can cover your equipment repair costs and reimburse yourself for lost income. Coverage typically covers a number of equipment related issues. Some examples are:

  • Payment to fix or replace failed equipment
  • Reimbursement for labor and time costs to fix or replace failed equipment
  • Replace lost business income due to equipment failure that leads to business stoppage
  • Cover costs to minimize losses or to get equipment working and productive faster
  • Reimburse for loss of materials or goods, such as spoiled food due to equipment shut down

Equipment Breakdown Coverage includes many options. Let the experienced professionals at Cobb-Hall Insurance provide solutions designed specifically for your needs.

Includes copyright material used with permission: Trusted Choice/Independent Insurance Agents

Consider Life Insurance Young – Here are the Reasons

Woman enjoying the weekend in the shopping mallReasons the young should consider Life Insurance

Insurance requires proactive planning rather than a reactive mindset.  Many people do not consider life insurance until they are older with larger financial obligations. While true that it becomes most necessary then, there are huge advantages for those who consider life insurance young.

A few facts to consider are:

Insurability Young and healthy is always the best time to buy insurance. Serious illness and increasing age are factors that can make insurance unavailable or cost-prohibitive. Permanent policies do not expire and Term policies can be purchased with options that guarantee renewal for decades.

Insurance As devastating as it is when someone young dies, life insurance can remove additional financial burdens that add stress to already grieving family members. Financial obligations can include funeral expenses, medical costs and student loans.

Cost The younger the age of the insured, the lower the price. This can be true for decades in the future and, depending on the option you choose, even for life

Cash Value Not knowing the future can prevent people from making decisions. Some policies, in addition to providing traditional life insurance benefits, build up cash value that remains available to the policy purchaser. In addition, money invested and future death benefits may serve as funds to borrow against in times of financial hardship.

Let the experienced professionals at Cobb-Hall assist you with your insurance decisions.

Drive Other Car Coverage

Drive Other Car Insurance

If you have a company vehicle and do not have a personal auto policy, you are at risk if you rent, Driving at sunset. View from the driver angle whileborrow, test drive or lease another car. A commercial policy ONLY covers you while driving the assigned company vehicle. Many business owners save money by insuring their private vehicles on company policies, not realizing they have NO COVERAGE if they drive another vehicle.

If you are an executive of a partnership or corporation, Drive Other Car coverage can be added to your existing commercial policy to protect you and your spouse. When using a vehicle other than your company vehicle, this coverage provides the same protection to vehicles you use that you have on your company vehicle.

With Drive Other Car coverage in place, if your neighbor lends you his pickup truck, you will have coverage to protect yourself, in the case of an accident, if you are injured or sued for injury to someone else. This coverage will also apply if the owner has low liability limits.

Commercial Insurance can be complicated, contact the experts at Cobb-Hall Insurance for innovative solutions designed specifically for your needs

 

Product Liability Insurance

Anyone Can Sue; Let Product Liability Insurance Protect You

We live in a world where anyone can sue for anything, regardless of actual fault or blame.  The cost US Dollar Hundred Bills In Windof product liability insurance is much less than the amount you’d have to spend if your business was involved in a lawsuit. It only has to happen once; a product you sell can cause injury and you will be sued, even if you didn’t manufacture it directly. This could financial disaster for your business.

Business Product Liability Insurance can protect you whether you are the product manufacturer, seller, or distributor. You can even purchase product recall insurance, designed to help cover costs associated with various recalls.

Product Liability protects from manufacturing or production, defects in design, or defective warnings or instructions and covers when someone is injured by a product you produce, resell, distribute, or wholesale. It will also cover court costs associated with a lawsuit pertaining to the product and handle medical costs for injury associated with the use of the product. Let the experienced professionals at

Contact Cobb-Hall Insurance to provide solutions designed specifically for your needs

Excerpts from: Trusted Choice/ Independent Insurance Agents

Pollution Liability

You May Need Pollution Liability Coverage

When many people think of pollution insurance, they picture large factories with billowing Smoking power plantsmokestacks, but many small businesses run the risk of pollution lawsuits. Businesses that use environmentally unsafe chemicals such as a hair salon, dry-cleaning service, garages, junkyards, manufacturers or those in the construction industry all face potential lawsuits.

Pollution insurance is created specifically to manage the costs associated with pollution clean-up and to cover liability claims for pollution-related injuries, illnesses or deaths. As damage awards for these claims can be extremely costly, having pollution insurance can protect your business from severe financial challenges or even bankruptcy.

Policies cover many types of small-scale pollution that cause contamination of soil, groundwater or property and air-borne contaminates like smoke and emissions. Many policies will even cover pollution that occurred in the past before the harmful effects of waste-products was known. Most policies include the following:

    • Legal defense fees  to provide your company with attorneys to defend you in a pollution-related lawsuit
    • Clean-up efforts compensate for costs if your company is required by law to clean up contaminants
  • Operations coverage is for businesses that use chemicals or hazardous materials. The two types are:  Catastrophic-for a sudden pollution-inducing event such as a fire or explosion     Non-catastrophic- which covers if pollution occurs over a long period of time and affects neighboring businesses or residents
  • Property transfer coverage protects property owners if they purchase a parcel of land or a building that was contaminated or otherwise polluted by a previous owner

Contact Cobb-Hall to review your pollution liability exposures and provide you with innovative solutions

Excerpts from: 2017 Trusted Choice, Independent Insurance Agents

Employment Practices Liability Insurance (EPLI)

Protect Yourself from Employment Practice Lawsuits

Employee lawsuits are more than just an inconvenience. They are expensive, distractive for your businessman pointing on one of the conditions of contractmanagement team and can quickly erode productivity and employee morale. Oddly enough, you are more likely to be sued by an employee these days than to have a fire at your facility. The financial damage of employee lawsuits can be dramatic. According to industry experts, unpaid internships, illegal background checks and issues related to pregnancy and health are the top trending employment practices litigation cases.

Employment practices liability insurance, commonly referred to as EPLI insurance, is specifically designed to protect employers from the financial hardships of lawsuits brought on by employees. This protection will easily pay for itself if you are sued even once.

EPLI provides compensation for losses caused by employee lawsuits, including court costs and legal fees.  Here is just a sampling of ways you are protected with an EPLI policy:

  • Wrongful termination: includes suits brought on the basis of termination due to age, race, gender or disability
  • Harassment: includes sexual harassment, violence, bullying and issues based on race, color, age and religion
  • Discrimination: including suits from employees who are turned down for employment or denied promotion
  • Breach of contract: violation of the terms of an employee’s contract
  • Emotional distress: applies if an employee feels that your business is a hostile environment or overly stressful
  • Other violations: including violations of statutes, workers compensation denial, false positives from drug tests, libel and slander, etc.

Contact the experts at Cobb-Hall insurance for solutions specifically designed to fit your needs.

Excerpts from: Trusted Choice Independent Insurance Agents copyright 2017