What types of insurance should I consider for my real estate business?
I'm not an insurance agent but I have owned small businesses for 11 years and I provided medical and dental insurance to my employees (when I had them). There are insurance providers which provide medical/dental to small businesses on the condition that the business has a "group" which can mean two eligible employees or more. Since May 2004, I no longer have employees, but here is some information you may want to consider.
Medical/Dental :I used Aetna-US Healthcare for medical insurance and it cost about $700 for a family ($15 copay) and included prescription drugs with a $15 deductible. In this plan, all my company needed was two eligible employees of which only one had to be an actual subscriber. I used Concordia for my dental plan and in that case we had to have 2 actual subscribers. The cost was about $85 for a family of four. There are a zillion sub-options to choose from and you should contact the leading medical and dental providers listed in your local B2B phone book and ask for the small group department. You may be able (not sure) to set up a company and have you and your spouse (or child over a certain age) as the two employees in order to qualify for a group plan.
One of the shocks when transitioning from employee to independent is seeing how much stuff really costs that the company used to pay for. This includes things like medical/dental insurance, the company's 7.65% portion of FICA, the use of an expensive photocopy machine, the numerous forms you have to file if you have employees (W-2's, quarterly Fed 941, Fed 940, monthly 8109, quarterly NJ-927, quarterly WR-30, monthly NJ-500, annual 1120, W-3, NJ-W-3, NJ Dept of Labor shortfall, etc.), W-9 for contractors, all kinds of 1099's, and everything related to worker's comp, just to mention a few.
The three areas which almost all small business owners consider to be a major necessary nuisance are legal, accounting and insurance. Some include marketing in that group, but marketing is the lifeblood of almost any business and is a positive force, whereas legal, accounting and insurance are things where if everything goes right, the best you can do is not lose.
Another comment: Almost all insurances went up after 9/11. I have professional liability insurance as well and it increased more than 100% since 9/11.
Long Term Disability Insurance: On the subject of insurance, you may want to seriously consider long term disability insurance. Mine costs about $250/month for about $65,000/year tax-free benefit if I can't function in my "own occupation" (with a 90-day waiting period). This is probably the most expensive disaster insurance I pay for. There is much less expensive LT disability insurance to cover not being able to work in "any occupation."
I once heard that a person is 6 times more likely to be injured and not be able to work in his/her own occupation than dying during the working years. Almost everyone has life insurance but few are willing to shell out the big bucks for own occupation disability insurance. If you have a couple of million $$$ in assets, you probably don't need such insurance because you can liquidate your assets and pay for food and other such stuff for the rest of your life. If you have say $500,000 in assets (or liquidatable net worth) and you are say 40 years old and you get into a car accident which doesn't allow you to work in your own occupation through normal retirement age and beyond, then the social security benefits plus liquidating your assets may not be enough to allow to buy food and other such minor stuff for the rest of your life. So, I shell out the $250/month and in my mind think like it's just another car payment or you can buy a house with $250/month positive cash flow which you can dedicate to this insurance.
Insurance was one of the many shocks I encountered when I left a high paying job in corporate America a decade ago. The biggest shock was probably accountability for absolutely everything including income. Unless you have a rich uncle, there ain't nobody to fall back on except on what you provide for yourself. This is obvious to people who grew up in non-salaried families but takes a whole lot of getting used to for people who grew up in families that Kiyosaki calls "go to school and get a job with good benefits."
Back to insurance...Insurance costs money and insurance companies must turn a profit. So from an actuarial standpoint, you must pay for less than you get unless you have a disaster.
Medical/Dental :I used Aetna-US Healthcare for medical insurance and it cost about $700 for a family ($15 copay) and included prescription drugs with a $15 deductible. In this plan, all my company needed was two eligible employees of which only one had to be an actual subscriber. I used Concordia for my dental plan and in that case we had to have 2 actual subscribers. The cost was about $85 for a family of four. There are a zillion sub-options to choose from and you should contact the leading medical and dental providers listed in your local B2B phone book and ask for the small group department. You may be able (not sure) to set up a company and have you and your spouse (or child over a certain age) as the two employees in order to qualify for a group plan.
One of the shocks when transitioning from employee to independent is seeing how much stuff really costs that the company used to pay for. This includes things like medical/dental insurance, the company's 7.65% portion of FICA, the use of an expensive photocopy machine, the numerous forms you have to file if you have employees (W-2's, quarterly Fed 941, Fed 940, monthly 8109, quarterly NJ-927, quarterly WR-30, monthly NJ-500, annual 1120, W-3, NJ-W-3, NJ Dept of Labor shortfall, etc.), W-9 for contractors, all kinds of 1099's, and everything related to worker's comp, just to mention a few.
The three areas which almost all small business owners consider to be a major necessary nuisance are legal, accounting and insurance. Some include marketing in that group, but marketing is the lifeblood of almost any business and is a positive force, whereas legal, accounting and insurance are things where if everything goes right, the best you can do is not lose.
Another comment: Almost all insurances went up after 9/11. I have professional liability insurance as well and it increased more than 100% since 9/11.
Long Term Disability Insurance: On the subject of insurance, you may want to seriously consider long term disability insurance. Mine costs about $250/month for about $65,000/year tax-free benefit if I can't function in my "own occupation" (with a 90-day waiting period). This is probably the most expensive disaster insurance I pay for. There is much less expensive LT disability insurance to cover not being able to work in "any occupation."
I once heard that a person is 6 times more likely to be injured and not be able to work in his/her own occupation than dying during the working years. Almost everyone has life insurance but few are willing to shell out the big bucks for own occupation disability insurance. If you have a couple of million $$$ in assets, you probably don't need such insurance because you can liquidate your assets and pay for food and other such stuff for the rest of your life. If you have say $500,000 in assets (or liquidatable net worth) and you are say 40 years old and you get into a car accident which doesn't allow you to work in your own occupation through normal retirement age and beyond, then the social security benefits plus liquidating your assets may not be enough to allow to buy food and other such minor stuff for the rest of your life. So, I shell out the $250/month and in my mind think like it's just another car payment or you can buy a house with $250/month positive cash flow which you can dedicate to this insurance.
Insurance was one of the many shocks I encountered when I left a high paying job in corporate America a decade ago. The biggest shock was probably accountability for absolutely everything including income. Unless you have a rich uncle, there ain't nobody to fall back on except on what you provide for yourself. This is obvious to people who grew up in non-salaried families but takes a whole lot of getting used to for people who grew up in families that Kiyosaki calls "go to school and get a job with good benefits."
Back to insurance...Insurance costs money and insurance companies must turn a profit. So from an actuarial standpoint, you must pay for less than you get unless you have a disaster.