The One Thing You Should Do When Forming Your Photography Business

Insurance, the one thing you need to get when forming your photography business

 

Have you ever felt over whelmed?  I thought I was over whelmed when I went into the service and first arrived to basic training!  Wrong!  Right now, I think I’m more over whelmed creating this photography business.  There is so much to know and to get done. That’s the main reason why I haven’t posted lately.  So, let’s go into this rabbit hole called “creating a business”.

What Came First, The Chicken Or The Egg?

When it comes to business, what came first?  The Tax ID (or EIN- Employee Identification Number)?  The creating of an LLC (if you think you need to be one)?  The DBA (Doing Business As registration)? Or would it be Small Business Insurance, more specifically Photography Business Insurance?

The Tax ID?

The Tax ID you really don’t need right away if you are a sole proprietor of your company and have no employees except yourself.  Even to open a business bank account (at least with Chase) you don’t need it, you can use your SSN.  The main problem with using your SSN only comes up when you start dealing with other venders/contractors because it seems that you swap tax ID’s (EIN’s) when you use each other’s services.  And, you really don’t want the other person to have your SSN.  You can do it if you want, but I wouldn’t want to do that.  So, this one is put on the back burner right now.

Forming An LLC?

The next item is creating an LLC.  If your business is a sole proprietorship under your own name, it seems that you really don’t need to be an LLC or corporation.  But, if you want that bit of legal “juju” under your belt and be covered legally in case someone wants to come after you and your business, this will “separate” you from your business.  I can’t exactly explain it right now, but that’s pretty much the jist of it.  I will explain it in a later post though.

Registering Your Business As a DBA?

Would it be the DBA you ask?  Nope, not quite.  But I will say, this is the second thing I’m going to do.  In a few states to include Texas (where I reside) you need to register my company name, or what’s considered a DBA (Doing Business As).  This is if my company name is NOT totally my name, like Danette Zak, nothing else in the name either.  Here is the example I found on the SBA (Small Business Administration) website:

For example, consider this scenario: John Smith sets up a painting business. Rather than operate under his own name, John instead chooses to name his business: “John Smith Painting”. This name is considered an assumed name and John will need to register it with the appropriate local government agency.

By the way, even if you’ve formed an LLC, you might need to register a DBA if you are doing business under another name other than what your LLC name is.  This is not a requirement of all states though and you should check to see if this is needed in your state.

Photography Business Insurance! It’s All About Covering Your A**!

Get photography business insurance to cover your butt
Is the cost of not having insurance too great?

The one thing I think is more necessary than any of the other business needs, is Photography Business Insurance.  If you are starting any kind of business, you need to be covered.  It is something that is crucial.  In many instances it is required for photographers to show proof of insurance at certain venues.  God forbid if a light stand were to fall over on someone while you were in a photo session with a client.  Wouldn’t you want to be covered just in case your computer or drives got corrupted at that most in-opportune moment? Even if I were staying a hobbyist, I would seriously consider being insured, especially if I were offering my services for money.

If you’re a hobbyist or photographer exchanging money for your services, I would highly suggest getting insurance to CYA (Cover Your Ass)!  We all know that photography is a very expensive hobby and we know that it wouldn’t be cheap to replace our camera nor any of the lenses, if they got broken or stolen.

Keep All of Your Receipts and Get Your Serial Numbers!

The one thing I wish i’d done was to print up and keep all of my receipts.  I do this with almost everything else in my life, but not when it came to this and I am kicking myself in the butt for it.  Even if the item is a gift, get the receipt from the the gift giver.  It will save you a lot of heartache.  Especially if you want to put your camera gear on your home owner’s or renter’s insurance.  Make sure you get photos of all of your gear, and the serial numbers.

I use the Evernote website or app to keep my photos of my gear and serial #’s organized (you can check out my post about my favorite apps here).  I also keep a copy of the serial numbers in my safe.  With Allstate Insurance I don’t need the receipts if I’m purchasing Photography Business Insurance, but I do need them if I’m including my photography gear in my home owner’s/renter’s insurance.

Do Your Research, Here’s Mine…

research the insurance you need for your business
My insurance research

A heads up on my information, don’t just rely on the info I’ve found, do your own research and see what’s best for you.  With that said, I went to the people my husband and I have dealt with for our insurance needs for over 30 years, and that was Allstate Insurance.  Before you ask, NO, I am not affiliated in any way with Allstate, it’s just who we use and trust.

First, I noticed that you can get a free insurance policy for your equipment through a PPA (Professional Photographers of America) membership.  It states on their membership joining page that you can get other insurance benefits for $150-$200/year with  any membership.  Something which I’m thinking about doing in the future, but not at this time.  They have memberships ranging from $17.17 to $27.92 with quite a lot of perks.

A great resource of insurance companies for photographers, is an article I found from PetaPixel.com.  Though it was written in 2015, a lot of the information was very helpful.  Besides the insurance companies they mention, you can also get Photography Business Insurance from Allstate and from Nationwide Insurance.

Coverage You Might Want To Think About…

Make sure to insure your data also
Insure your Data

Below are some of the options of coverage you might want to think about getting.  And yes, there is a cost to having these added to your insurance policy.

  1. Business Property Coverage:  This covers your property, to include camera gear, your computer, office equipment, etc.  It might even cover your studio, make sure to ask your insurer what this all covers and what types of damages it covers.
  2. General Liability:  If you are a small business, you should consider this insurance coverage no matter what. Accidents happen and this coverage is for those times.  What if you have a light stand that topples onto someone and injuring them.  Without this coverage you will be in deep doo doo.  You don’t want to pay out the nose for someones hospital bills or for the legal expenses that could add up due to an incident like this.
  3. Business Interruption Coverage:  Could your business survive if your studio has a fire or a tornado takes it away?  This is coverage for that “just in case” time and you need to get your business back up and running after something so devastating.
  4. Professional Liability Coverage (Professional Indemnity Insurance or PII):  This insurance helps protect the provider (such as doctors, lawyers, photographers, etc) for any mistakes that you make.  And can help defend you against a negligent claim that a client may make against you.  This type of insurance can help provide for the defense costs, including when legal action turns out to be groundless.  NOTE:  This coverage DOES NOT include Criminal Prosecution, nor a wide range of liabilities under civil law.

And here’s some more coverage to consider…

  1. Failure To Deliver Coverage:  This is coverage for those instances when you Fail to deliver your product to a customer due to unforeseen circumstances.
  2. Data Extraction Coverage:  Provides protection for the cost of extracting your data from a drive that has a incurred accidental physical damage.
  3. Cyber Liability Coverage:  This protects you against damage caused by a virus, malware, etc.
  4. Data Compromise Coverage:  This provides coverage for expenses arising from your client’s personal data being stolen from your computer.
  5. Hired Auto Coverage:  Provides coverage for rented vehicles used for your business.
  6. Non-Owned Auto Coverage:  Provides protection when your employee is in an auto accident while using their vehicle for business.  For example if they are driving to a shoot or running errands for the business.
  7. Employment Practices Liability Coverage:  This protects you against alleged acts of discrimination, wrongful termination and harassment brought by employees or employment applicants.

My Final Thoughts…

When looking for Photography Business Insurance, or even just coverage on your equipment (something we should all have) make sure you go with a reputable insurance company.  That’s why I chose to go with the insurance company my family has dealt with for over 30 years.  Just make sure you are covered for any mishaps that might occur and know that they will be there for you.

When I talked to my agent about my insurance coverage needs, she was very understanding and suggested a few things that saved me a few duckies on my premium.  So yes, I think it’s always best to deal with a reputable company and talk to them on the phone or in person.  No matter what you do after reading this, think about getting insurance.  At least for your gear if for nothing else.  It’s all about having that peace of mind!

Remember, enjoy life, enjoy the day and take lots of photos for the memories!

 

 

 

 

 

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