Member/Owner vs LLC as named insured on insurance policy
Hi everyone,
I have an LLC that holds a couple of properties. Am getting a lower premium (approx $250-$350) if I have one of the members of the LLC as named insured. Upon some research, I found that the 2 disadvantages of having it set up this way are:
- Any claims can be a part of my personal record (and could affect insurance quotes in the future on the personal side).
- In case of claims, the insurance check would be made out in the member's name as supposed to LLC's name.
Are there any important considerations/areas/risks that I am missing? Especially from a personal/LLC liability standpoint?
What is typically recommended?
Thanks for taking the time to read!
Most Popular Reply
Jay,
I know when I write policies in an LLC, different companies like it to be written differently. Some List the LLC as the named insured and then the individual partners under that as named insureds. Others want the LLC to be an "additional insured" almost like a Mortgagee but want the policy in the name of the individual(s) and that's how they rate it. Some companies won't write the policy in the name of the LLC period. Never have I seen it cost you more or less to do either.
Just make sure on the commercial policy your addressing coverage like:
*Replacement Cost(the property and any personal property). Be in the know if you're dealing with a "coinsurance" clause.
*Loss of use or Business income. This is a biggie. You want to be paid if you have a loss and can't rent it while it's being repaired/rebuilt etc.
*on the liability side, find out whether the limit is per location, per term, per door whatever. Just know what your policy covers.
I hope this helps??