What is the Cheapest/Best Insurance company for My Vending Machines

[bandersnatch27]

Yes, Liability insurance for my Vending machines.

I got a "Yes" from a Very Lucrative Location (I'm estimating) & they said I need to have Liability Insurance.

So who is the Best/Cheapest? i'm looking for Cheapest, also the best too though? I want the most coverage for my money.

any suggestions? thanks! & may god bless you!

[alyssamma]

Bander,

This isn't an easy question to answer. If you do a quick search, you'll see the companies that others here have used.

That being said, prices vary regionally and vary by other factors (e.g., do you have another policy with the company, what is your credit score, etc.).

Also, find out exactly what the company wants. They may want to be named as an additional insured which is a slightly different question than you are asking.

Lastly, *best* and *cheapest* are almost always contradictory. Pick one

Kevin

[bandersnatch27]

Hey thanks, Questions for u still:

So, They did ask to be listed as an additional insurer is that More expensive or difficult?

& also, how can I do a quick search of what insurance companies others use.

[bandersnatch27]

Hey, what is the website for your Insurance company? or the phone number?

i'm trying to find it, & having trouble.

thanks!

Bander.

[alyssamma]

Sometimes you'll be charged a slight extra fee to have someone named as an additional insured...it depends on the company.

However, the reason I say that is a slightly different Q is that the company may require certain minimums. For example, you may be happy with a $100K policy because your assets are only worth $50K. However, the company may have millions in assets and want a higher policy amount.

Kevin

[whaletail116]

Alyssamma,

You seem very knowledgeable in this subject.  For that I am grateful.

So what's the difference between getting liability insurance and forming a LLC?

Thank you.

[alyssamma]

Whale, np...read this post: http://vendiscuss.com/forum/index.php?topic=5975.0

If you still have Q, let me know and I'll be happy to answer them

Kevin

[bandersnatch27]

So what are some Good insurance companies that will insure my machines? or cheap ones? I am in Los angeles area, CA

State farm is 1 I heard of (I have a lot of Restaurants tho, & I heard they may not do Retaurants)

whats another? what are some others?

thanks!

& May god bless you!

[dsimms]

Alyssamma,

You seem very knowledgeable in this subject.  For that I am grateful.

So what's the difference between getting liability insurance and forming a LLC?

Thank you.

If you have LLC, and you get sued, then

the LLC takes the hit, and not you personally, now liability insurance could

protect your assets in the LLC...if you have 100k liability, and you get sued

for 50k, then your insurance could pay that claim, or settle for less...if you

did not have liability, then your assets in your LLC will be liquidated, otherwise

the lawsuit would go up against your liability...even if you do not have LLC, then

your liability  protects you to a point, but they could sue you personally, and your

liability insurance for your business.

[dsimms]

LLC and liability is a misconception...yes, it is important to have these, but does that mean

you are really safe from being sued? absoutely not..do you have a good size defence fund,

lets say $25k-$50k?? If something happens, and your LLC gets sued, you will still need

cash for court costs, attorneys, fees...all of these costs are not free just because you

have LLC or liability...are you willing to use your personal assets to defend yourself, are

you willing to sell part of your business to help defend yourself ?? Even if your liability

is paid, more then likely, your will be personally broke having to go through all this...

unless your business is doing just that good....wait to a claim is paid, your carrier will

drop you, and your next carrier will charge you like you never seen before...insurance is

always good to you if you have no claims..wait til a claim comes up, they will murder you

on your next insurance fees....they may not be able to go after you personally, but you

do have to use your personal /business finances to defend yourself in court...

[whaletail116]

So which do you recommend?

[alyssamma]

Well, actually, LLC and liability is not a misconception. The second L kind of spells that out.

The purpose of forming an LLC is twofold. First, with an LLC (as oppossed to a corp or sole prop), it is *much* harder to sue the owners. In fact, in most states it is impossible. This isn't to say a lawyer couldn't name you personally in a suit, but it is to say the odds of that happening, and then a court accepting it, are close to zero.

Why? Well, just like you say it takes $ to defend yourself, it also takes $ to sue someone. No lawyer is going to take a case solely on contingency that they *know* they will lose.

So, having the LLC protects your *personal* assets from being sued.

The second point is that, in general, you keep the assets of the LLC low. You have a few grand in machines...that is nothing worth suing over. And if they do, you take the loss, walk away, and form a new LLC.

Even if you are running full line and have tens of thousands in assets there are ways to use an LLC to "hide" them. Of course at that point it might be easier to get liability insurance, but the options are still there.

Everyone should understand that an LLC is a very effective tool to protect assets.

Kevin

[whaletail116]

So Kevin, do you have both an LLC and liability insurance?  Or is liability insurance not needed with an LLC, and vice versa?

I see you've added four machines to your total placed.  Thatta boy.

[alyssamma]

hehe...yeah, I have been a little lax about keeping the totals up

Anyway, I own a few business entities - 2 LLCs and an S-Corp. The vending is under the S-Corp. I have liability insurance also for the vending portion of the S-Corp because it is pretty cheap ($225/yr) and for peace of mind - which is why you always get insurance

That being said, read that post I gave you. It explains when you need liability insurance.

Kevin

[dsimms]

I think in a lawsuit, someone would prefer to keep their business, rather then

loose it, and just walk away. If you built something up over time, would you be

fine with just walking away, and your 10k-20k of eqiupment is sold for pennies

on the dollar, this is why this is important to have liability so this does not happen.

yes it does take $$ to start a lawsuit...lets say your soda machine has a short,

and shocks a kid to death...and I have been shocked by a soda machine...

I asssure you that mil dollar liability may come in handy...that family will

not have a hard time finding an attorney to pick you apart...

If you are very small, then you probably would not even consider LLC or Liability,

but if you growing into machines that could cause harm, then you should get it,

and grow your liability as you grow...I would not think you would need it

on just bulk machines...someone would have to push a bulk in order for

it to fall over...

[alyssamma]

The second point is that, in general, you keep the assets of the LLC low. You have a few grand in machines...that is nothing worth suing over. And if they do, you take the loss, walk away, and form a new LLC.

Even if you are running full line and have tens of thousands in assets there are ways to use an LLC to "hide" them. Of course at that point it might be easier to get liability insurance, but the options are still there.

dsimms, read what I said carefully. I specifically said if you keep the assets low in the LLC. If you have a few grand you walk away. When you lose a business like that, all you are losing is the few grand - nothing more. Just reform a new LLC and keep going. You don't lose your accounts or anything else like that.

If you have $10-20K like you mentioned, I said there are ways to hide those assets, or, simply get insurance.

Lastly, I want to make an important point. There is a big difference between what *can* happen and what has a reasonable chance of happening. I *can* win the lottery - but it is very unlikely. So I'm not planning my life around it.

Similarly, a kid *can* be shocked to death by a vending machine, but I believe that is even more unlikely than winning the lottery. Note, I said it *can* happen. In fact, here is a case: http://ecmweb.com/mag/electric_case_lethal_candy/

And here is a list of other vending deaths: http://www.listafterlist.com/tabid/57/listid/9140/Health/Vending+Machine+Deaths.aspx

But I could just as easily do a search and pull up 10x the amount of lottery winners in that same time period. Yes, more people probably play the lottery than use vending machines, but you get my point.

If you want to worry about those extremely unlikely things, then get insurance for them. But if you are worried about the very unlikely happening, then double check the fine print to make sure you are really covered for what you think you are.

Kevin