EEVblog Electronics Community Forum
General => General Technical Chat => Topic started by: elcomtel on July 13, 2013, 04:02:48 am
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Ok.... I'm a newbie or rookie to self-employment. Most of my working life I have been institutionalised by working for an employer.
I have set up my 'sole trader' business:
ELCOMTEL
http://www.elcomtel.com.au (http://www.elcomtel.com.au)
Questions
- Should I get liability insurance as a sole trader?
- Where do I get this insurance (will I need an insurance broker?)?
- How much cover and how much should I expect to pay?
If anyone has such a liability insurance policy, would they like to tell me who their insurer is.
A recommendation or word of mouth is worth more than any advertising brochure.
Thank you!
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As per my other thread reply, 10M cover is pretty standard for what you want to do.
I use a broker. You can do all the leg work yourself, but the commission they charge is not bad and will often save you money.
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You guys get drilled for $10M in Oz?
Jeeze...I thought I was getting the shaft for needing $2M in the U.S., and only that much because I do work in hospitals on medical equipment. If it wasn't for that part of my business, even $1M would be a lot.
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You guys get drilled for $10M in Oz?
Jeeze...I thought I was ghetting the shaft for needing $2M in the U.S., and only that much because I do work in hospitals on medical equipment. If it wasn't for that part of my business, even $1M would be a lot.
I remember it was 1M, then 5M, now 10M coverage is expected for a lot of places.
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I've usually been asked to have £1m in place at places I've worked.
In the UK I've used Chaunce O'Hara. I did try someone else but one of the questions on the form was "could the product kill if it malfunctioned." As I was working on a military project, I gave up, rather than writing "hopefully"
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Actually, the bigger sites demand $20M now (last 3+ yrs). $10M only buys you a skinned knee nowadays :-)
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@elcomtel:
I have been investigating liability insurance. There are two kinds:
1) To cover the cost if you accidentally bump something over or worse trip over a wire and halt the production for a week.
2) To cover damages caused by your products or work
Type 1 is usually pretty cheap. Type 2 is ridiculously expensive. The better way to protect yourself against claims is to make your business a seperate entity (a limited). If something goes wrong hopefully only the business goes into bankcrupty. You'd be very wise to seek some advice from the chamber of commerce and a bookkeeper on these really important issues! Excuse me for saying this but I got a feeling you got layed off and have a hard time finding a job. You clearly didn't plan for it and you also seem to have no experience with dealing with customers, financial planning, etc, etc. I'm not saying its impossible but you're in for a really rough ride and you really need to be able to reflect on yourself. Some customers won't be satisfied at all by what you think is a good job. At such points you have to swallow your pride, stay calm and try to get the customer to explain what he expects AND most importantly: make it right!
Oh, and do you really need to put a link to your website in every topic you start >:D Better subscribe to freelance websites, look for websites like these with a 'personel wanted' section and look through the classifieds to search for customers.
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In the UK, if you are negligent, having a Ltd company won't protect you if you cause injury or death.
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@elcomtel:
I have been investigating liability insurance. There are two kinds:
1) To cover the cost if you accidentally bump something over or worse trip over a wire and halt the production for a week.
2) To cover damages caused by your products or work
2 is normally called professional indemnity insurance
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In my experience insurance companies and brokers like to mix terms and as usual the difference can only be found by reading the fine print. In several cases I caught an insurance broker trying to sell me an insurance which didn't cover what the broker promised it would cover.
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An unrelated comment if I may...
I think you are making a big mistake by trying to say you can do everything for everyone on your website. Frankly, I would never even contact a company who says they are
-An outsourced electronic design service
-A contract electronic design support service
-A PCB manufacturing service
-A PCB assembly service
-A re-engineering service
-A reverse engineering service
-An electronic assembly service including stuff bought as kits or schematics from magazines (wtf?)
-A wire harness/cable assembly service
-An obscure parts location service
-A component parts supplier
-A technical writing service
-A printing and binding service
-A website development service
-A video production service
-A photography and graphics service
-An IT support service offering network administration, computer repair and sourcing, website development, security, etc
-An electronic repair service fixing power supplies, digital systems, and "everything else"
-An electronic equipment installations service
-An importer and seller of ARM/PIC/FPGA kits
-An e-shop selling ham radio, computer parts, electronic kits/parts and automotive stuff
For many of these things, your website states you are the best, or you have so much experience or your company is highly regarded in the industry, etc.
Please do not take this the wrong way because I am not trying to bash you - I don't know you, this is just observation from your website. Your site screams "I am a guy who is just looking for something, anything... I'll come to your house and iron your clothes, or wash your car. Anything that earns me a buck!". But because you claim to be the best at everything, I think it comes across that you are not the best at anything.
We bought a couple of pick and place machines last year. We ended up paying for a specialist from another state to our office (at great cost!) to install and set up the machines. Your website says you do this, but I would never have hired you for it because I would know from reading your site that you have no experience with this type of machine and it would take you infinitely longer than the specialist. He was a MyData engineer and his whole business is service, training and repair of MyData equipment. He came and within a few hours, had everything working, feeders installed, placing parts, etc.
I had an issue with a spindle drive on a CNC lathe last year, and a servo drive on a CNC mill a couple of years prior. I looked for a repair service online. There were several who all listed the specific models and brands they specialized in on their website, and quoted prices for repair. I asked around the CNC forums and a couple of outfits were recommended, so I used them. These are people who repair these types of drives every day and they know the common issues and where to look. I would never use a service such as yours for that because I'd be thinking "maybe he's off making a website for someone today, or having a user manual bound?" I want someone who specializes in repairs of the parts I need repaired.
There are companies that specialize in book printing, video production, website design, etc. Are you really saying you are competitive in price and quality with those others? Of course not.
I strongly suggest you trim down all of the services you offer. You should focus one a few things you are really good at. I think your website is going to drive away any potential customers who come across it... I know it would drive me away. Also, I am sure you realize that your website will generally not get you many customers anyway - it will be word of mouth and referrals where 99% of your work will come from, so you need your website to back up the services you are selling to those clients, not to be a "hey, we can do anything for anyone cheaper than anyone else!" sales mechanism.
Again, don't take it the wrong way - I am just trying to be helpful.
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Greetings EEVBees:
--As far as insurance goes, you just never know what could happen. A friend of mine is an independent subcontractor, working for a contractor that does BrightHouse Cable installations and repairs. He carries a couple of million coverage with a two thousand deductible. He was drilling a hole in a wall, when the bit came loose and was lost in the wall. He put another bit in and finished the installation, no worries, right? Wrong. When the spade bit fell inside the wall it hit a water line, causing a small leak. About 4AM the apartment dwellers were awakened by thier neighbors who live below, complaining about water coming from the ceiling and ruining everything. When they went to answer the door, they discovered about and inch of water on the floor. End result was about 80K total in damages to goods and structure. He was damn glad his employer forced him to go to broker and get insurance before starting work. It does not take to much imagination to think of a scenario where a death might have resulted.
"I wear suspenders and a belt. I am a security man all the way"
Justin Wilson (The Cajun Cook) 1914 - 2001
Best Regards
Clear Ether