I’m starting an engineering business (LLC) on the side (designing plumbing systems, stamping drawings etc). I’m getting a professional liability insurance and I’m trying to figure out how to think about the limit of the policy. I got a few quotes and the coverage limit is typically $1m or $2m but I don’t know if I need that since this will be an LLC and they can’t go after my personal assets. I think I would have a revenue of max $50K/year, so is there any reason to have $1-2M in limit? Thx!

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Not everything is guaranteed with an LLC. There are indeed some circumstances they can go after your personal assets. Plus with no real operating history most banks and even some vendors and suppliers will require a personal guaranty from you particularly for an LLC meaning there will likely be debts you’re personally on the hook for. I’d get with a lawyer or at least an accountant near you on the LLC question/limits/advantages/disadvantages to make sure you aren’t making assumptions that won’t pan out.

Plus on top of that we don’t know your geographic area or the size of the projects you’re undertaking. A reputable insurance broker if you talk to several may be able to clue you in on what the average coverage amount is for your business/size of business and you can take those quotes and make a more informed decision

My personal opinion is no . Although I would consult an attorney . You’re designing not doing anything onsite . If that is correct I say no .

As a fellow LLC small business owner, when I went looking for insurance quotes, it seemed that the minimum policy amount is about a million dollars.

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