FAQ Friday: Business License & Insurance | A Word From Will

FAQ, Tips, Info

May 10, 2013

So if you’ve forgotten or missed part 1 of the Starting Your Photography Business blogs, you can check out part 1 here.

I figured you might be interested in continuing this journey with me through some of the steps to starting a business. So, in my last blog, we started out talking about choosing the right name. Today we’re going to talk about the next few steps in starting your business.

 

Get a business license

 

Your current local laws probably require any individual or company that engages in business to pay a license fee. Depending on the type business you’re opening, the fee will vary; however, for our purposes a photography license for a business operated out of the home is generally less than $20. Simply put, get a business license before you start doing business. It’s not expensive and it allows you to operate your business LEGALLY. Also, it’s tax deductible…so Win Win.

 

Get insurance

 

Again, this may seem a little obnoxious; however, it’s one of those things where you weigh the costs. It may set you back a few hundred a year, but it’s way better than losing your house in a lawsuit.

Scenario #1

Mr. Budlight had a few too many at the wedding reception you’re photographing. While he may have broken your tripod during his fall, he also broke his leg and wants to sue you. Now that general liability insurance doesn’t seem like such a bad purchase after all.

 

There are three different types of insurance we carry:

General Liability

Equipment

Indemnification

 

The scenario above is a great example of reasons to purchase general liability insurance. If you’ve purchased $30,000 in camera equipment, you definitely want to cover it with insurance should something break. You can just ask your insurance agent about a policy for your equipment. Still hesitant? Most of us insure our cars and they aren’t worth that much. Just think about it.

Side note: Generally, business equipment will not be covered by your home insurance. Ask your insurance agent to confirm.

The third type of insurance is indemnification. The base definition is: insurance that protects you against loss or damage. The easiest way to look at this is through another scenario.

Scenario #2

You’re driving to a wedding with your equipment in the trunk of your car and someone rear ends you. Not only have they destroyed your car, but your equipment is destroyed. Your client is not as understanding as you had hoped and even though you offered a full refund and tried to make things better; your client hires a lawyer and sues you.

Heaven forbid you ever find yourself in that situation, but if you ever did, indemnification insurance would be a life saver. Want some good news!? It’s not expensive and it’s easy to obtain. In fact, PPA (Professional Photographers of America) members have the option to pay an additional fee on top of their membership fee to obtain this service. So for a yearly fee of around $300 you not only get to opt in to their indemnification trust, you also get all the other benefits of being part of this great resource.

 

I hope this has helped to point some of you in the right direction! If you have any specific questions, feel free to ask away and I’ll be glad to share any input I have!

Stay tuned for Part 3 (Contracts) coming soon!

 

-Will

 

 

  1. Jacki says:

    Bravo Will! Maybe this will motivate me to move quicker on my business license. ..I’m so slow…

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destination wedding photographer, boutique photo editor, and coach to photographers

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