Foreclosure Cleanup Business Advice: Why You Need Insurance and What Type to Get
If you’re thinking about starting a foreclosure cleaning business, you need insurance; that is not up for debate. But, how much and what kind to get is what causes most potential business owners in this sector the most frustration and confusion. For example, recently, I received this email:
I have a question about [foreclosure cleaning] insurance that I hope you can assist me with. . . I have been unable to find an insurance company that will cover me for worker's comp b/c they say it is too high.
Am I going about getting the insurance wrong or asking for the wrong thing? IS there a minimum amount of insurance that I should start out with before trying to get the worker's comp?
Foreclosure Cleanup: 5 Factors that Determine the Types of Insurance Needed
Following are five factors that determine what type of insurance you will need for your foreclosure cleanup business, as well as how much you’ll need.
(i) Service offerings: Will it be simple trashouts, or will you offer lawn maintenance, lite repairs and tree cutting. Decide what types of services your foreclosure cleaning company will offer.
(ii) Laws in Your City/State: The types of insurance you’ll need varies from state to state, and even sometimes from city to city. You’ll need to consult an insurance agent for specifics.
(iii) Employees: If you hire employees, you will need workman’s comp insurance.
(iv) Bidding on Government Contracts: Even if you don’t have employees, if you plan on vying for government contracts, you’ll most likely be required to get workman’s comp insurance.
(v) Business Classification: All businesses are classified (as in, put into a certain category) before the type of insurance they’ll need is determined. In one state you may be classified as a simple janitorial service, in others you may be considered a general contracting business.
This is why it’s extremely important to determine what type of services you’re goiong to offer before you go looking for insurance. For, this will go a long way in determining what type of business you’re classified as.
Foreclosure Cleanup Business Insurance Tip
Don’t offer services that you can’t afford to be covered for. For example, instead of offering lite repairs, offer simple trashing out and lawn maintenance. You can always add on services (and get the proper insurance for these services) once you start making money. This is known as making your business pay for itself.
Get more detailed info on foreclosure cleanup business insurance, ie, why you need insurance, an overview of the types needed and the best way to get the type of insurance your need.