Q.
I run a small business and a restaurant. Recently, a customer told me that he slipped and fell in the bathroom and hurt his back. He asked for my insurance information, and I gave him this information. However, I forgot to pay the last premium, so the insurance company refused to pay. Now, the customer has hired an attorney and has sent me a letter saying that if I don’t pay him $25,000, he will sue. Please tell me what my best options are in this situation.
A.
Whether your business is large or small, liability insurance is a very important part of your business. Like auto insurance, liability insurance provides a financial safety net in the event of an accident that is the fault of your business. And liability insurance covers compensation for injuries sustained by visitors or customers of your business.
Unfortunately, if you are late with your insurance payments, your coverage will likely be denied. For this reason, it is a good idea to set up automatic withdrawals from your bank account for insurance premiums such as auto insurance, health insurance, and business insurance.
Your insurance appears to be invalid, and you have no other option but to settle with the client, or hire a credible attorney if you are sued. Unfortunately, whether or not you were actually at fault, you will either have to pay the money or hire an attorney to settle the case.
In California, your personal assets are protected from business liability, so you don’t have to worry about protecting your home or other assets.
As a business owner, there are three risk situations you must prepare for.
1. Physical injury: This is an injury caused by a customer visiting your business. For this reason, you should always have liability insurance. If the company name or business owner changes, you should definitely notify the insurance company.
2. Workers Compensation: This is when an employee gets injured on the job. In California, employers are required by law to carry workers compensation insurance. Employees do not have to prove that they were injured because of their own negligence. For example, a dishonest employee can simply claim that he hurt his back while lifting heavy objects on the job. You should always carry workers compensation insurance and make sure that you do not miss any payments.
3. Minimum wage/overtime/meal and break times: Disgruntled employees love to sue their employers when they are not paid enough or given enough breaks. And there are plenty of workers' attorneys who will take on these cases. Always keep track of work hours and break times. If you pay your employees cash, always get them to sign a receipt. And consider installing cameras to record your employees' break times. Also, there is generally no insurance that will protect you from legal claims from employees.
Q.
I run a small business and a restaurant. Recently, a customer told me that he slipped and fell in the bathroom and hurt his back. He asked for my insurance information, and I gave him this information. However, I forgot to pay the last premium, so the insurance company refused to pay. Now, the customer has hired an attorney and has sent me a letter saying that if I don’t pay him $25,000, he will sue. Please tell me what my best options are in this situation.
A.
Whether your business is large or small, liability insurance is a very important part of your business. Like auto insurance, liability insurance provides a financial safety net in the event of an accident that is the fault of your business. And liability insurance covers compensation for injuries sustained by visitors or customers of your business. Unfortunately, if you are late with your insurance payments, your coverage will likely be denied. For this reason, it is a good idea to set up automatic withdrawals from your bank account for insurance premiums such as auto insurance, health insurance, and business insurance. Your insurance appears to be invalid, and you have no other option but to settle with the client, or hire a credible attorney if you are sued. Unfortunately, whether or not you were actually at fault, you will either have to pay the money or hire an attorney to settle the case. In California, your personal assets are protected from business liability, so you don’t have to worry about protecting your home or other assets. As a business owner, there are three risk situations you must prepare for. 1. Physical injury: This is an injury caused by a customer visiting your business. For this reason, you should always have liability insurance. If the company name or business owner changes, you should definitely notify the insurance company. 2. Workers Compensation: This is when an employee gets injured on the job. In California, employers are required by law to carry workers compensation insurance. Employees do not have to prove that they were injured because of their own negligence. For example, a dishonest employee can simply claim that he hurt his back while lifting heavy objects on the job. You should always carry workers compensation insurance and make sure that you do not miss any payments. 3. Minimum wage/overtime/meal and break times: Disgruntled employees love to sue their employers when they are not paid enough or given enough breaks. And there are plenty of workers' attorneys who will take on these cases. Always keep track of work hours and break times. If you pay your employees cash, always get them to sign a receipt. And consider installing cameras to record your employees' break times. Also, there is generally no insurance that will protect you from legal claims from employees.