Re: Liability insurance in TechComm?

Subject: Re: Liability insurance in TechComm?
From: Audrey Choden <AChoden -at- COMPUSERVE -dot- COM>
Date: Wed, 16 Dec 1998 10:27:45 -0500

Andrew Plato <intrepid_es -at- YAHOO -dot- COM> wrote:

>As an independent contractor you do not need nor would I recommend
>liability insurance. Some agencies tell want-to-be-1099s they need
>liability insurance as a tactic to get you to W2 with them. There is
>absolutely no legal requirement anywhere in the U.S. for freelance
>tech writers to carry such insurance.

>However, if you form a corporation (S corp, LLC, or C-corp NOT a
>sole-proprietor) you will need to get liability insurance. It is
>about $500 a year for $1 million in coverage. Most standard business
>insurers can provide this type of insurance. Some of the larger
>companies require corporations to carry this insurance for
>subcontractors and employees.

>However, if you do not plan on expanding into a corporation - do not
>waste time or money on liability insurance. However, also do not plan
>on independent contracting with any of the large high-tech companies.
>You will have to go through an agency.

I agree in general with what you wrote. However, there are situations
where a company will require liability insurance before giving a Master
Agreement to an independent contractor. In the 10 years I've been
working as an independent, I've only had one company (a large high-tech
one) require this insurance. Yes, it's unnecessary, but I found a policy
for $125 a year for $1 million in coverage that also covers property in
my home office. And I've gotten a lot of business from this company
over the past 8 years that has more than covered this expense
(which is tax deductible anyway).

I think it all boils down to whether the contract is worth the expense.
For a one-time, small project, I don't think it is.

Audrey Choden
Training by Design
5011 West 66th Street
Prairie Village, KS 66208
(Kansas City)

(913) 432-7414
fax: (913) 432-8744
achoden -at- compuserve -dot- com

"Custom course development"
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