Possible limits of insurance you could seek are:

• $1,000,000 Each Occurrence
• 2,000,000 General Aggregate
• 1,000,000 Products/Completed Operations Aggregate
• 1,000,000 Personal & Advertising Injury Liability
• 100,000 Fire Damage Legal Liability
• 5,000 Medical Expense Limit - Any One Person

Liability for subcontractors is usually excluded on liability policies. For this reason, you should always make certain that any subcontractors you employ, such as labor, lighting companies, etc., have their own liability policy. It is good practice to keep a copy of each subcontractor’s certificate on file and use the same subcontractors as often as possible.

Many liability insurers will require that you have a signed contract for every job that you do. This proves that you are indeed supposed to be there and are responsible for anything that might happen, thus streamlining any potential claim process. This is, of course, just plain good business anyway and gives you ammunition to counter any client who objects to signing contracts.

There is one additional feature you should insist on when shopping for liability insurance and that is the ability to purchase “Additional Insured” certificates. In recent years, it has become more and more common for large corporations, city governments, schools and universities to require that you add them to your liability policy as an “Additional Insured” when providing production on their property or in their behalf. This supposedly protects them from being sued for a mishap that occurs at their event or on their property that is your responsibility.

3. Vehicle Insurance - Insurance to cover your commercial owned or leased vehicles.

This is rather straight forward. If you own a company truck, it has to have liability insurance, just as your personal vehicle does.

If you lease a vehicle from a company such as Rollins or Ryder, you will be assessed an insurance premium in addition to your daily or weekly rate. You may find it more cost effective to procure your own insurance policy for the leased vehicle.

In the case of seasonal shops, this can be especially perplexing. For example, in my own business, we lease a bobtail van 7 months out of the year (also called a “long term rental”) and rent one-offs during the slower season. The company owns a pick-up truck, for which it has an insurance policy. On that policy, we have a rider that allows us to add and delete additional vehicles when needed. The resultant premiums are much less expensive than paying the rental company’s insurance charge.

There are other types of insurance you may wish to concern yourself with, such as health, disability and worker’s compensation, which I decline to discuss in this paper. Health and disability are personal issues, although a company may choose to provide them for its employees. Worker’s Compensation is indeed a business concern; however, the laws concerning it vary from state to state and I am not qualified to discuss it.

Shopping for insurance can be just as confusing as the insurance itself. You have numerous providers to choose from. You must remember, however, that you are in a specialized industry with a very small niche market. There aren’t even specific insurance codes for sound reinforcement and you can get pigeon-holed in any number of different categories. My company, for example, is listed as a “Traveling Theatrical Company”, which was the closest thing our agent could come up with. You are urged to seek out insurance agents who are familiar with your business and understand completely what it is that you do.

Your choices for providers fall basically into three categories:

• Major Insurance Carriers - Big name corporations, such as Hartford, State Farm, etc.;
• Independent Insurance Agents - Agencies that have the ability to shop endless sources in the marketplace to find the most suitable policies for you
• Professional Associations, such as the American Federation of Musicians, who offer group policies at reduced rates.

The price of insurance can be staggering and because the cost varies dramatically from one company to the next, serious comparison shopping is advised. Don’t end up paying a higher premium just because you didn’t take the time to investigate all avenues available to you. And remember that, although it comes out of your pocket in a very large chunk, it is also tax deductible at the end of the year.

The peace of mind insurance can provide you is well worth the effort and expense of procuring it. Don’t fall victim to the “It Can’t Happen To Me” syndrome. “It” can and will happen to the best prepared, most honest and angelic person in the world. Just make certain that you and your assets are covered when it does.