Commercial General Liability Insurance and L.L.C.'s

[Wealthinvestigator]

Hello to all, I have read that it if you create an L.L.C. with the intent of performing rehabs, it is wise to obtain Commercial General Liability Insurance. This insurance will help you in the event someone becomes injured (other than the contractor and workers) on or around the area of the property.
1) Can anyone provide me with additional information about this type of insurance policy?
2) Is it really necessary when you are performing rehabs?
3) What are the ranges of costs annually to retain or obtain this insurance policy?
4) Is the rates higher for a newly formed L.L.C.?

[mcwagner]

You should always have liability insurance.  it's your first line of defense.  

Check with your whoever covers your homeowners; they'll usually give you a break on the price.  If the house is not liveable, they may want you to have a "builders risk" policy rather than P&C.

[Wealthinvestigator]

McWagner I understand the necessity of having liability insurance. Can you please explain the meaning of "P&C"?

[mcwagner]

property and casualty

[Wealthinvestigator]

Thanks for explaining the meaning of "P&C' McWagner. Also, Are you advocating to get the Commercial General Liability Insurance and the builder's/landlord's policy for rehab ventures? Or is the builder's risk policy sufficient?

[mcwagner]

they are all different types of insurance and all have their place.

builder's risk covers the structure (the bank, or you if you own it free & clear) during construction
P&C covers the structure and contents, and maybe you to some degree(again, the bank) once it's "liveable"
you'll need one, but not both, and which one will probably be determined by the lender.

general liability protects you (and/or your company)
don't leave home without this one.

[Wealthinvestigator]

Okay, I will definitely obtain the Commercial General Liability Insurance.  As you stated, the lender would  probably decide the insurance policy I must obtain when I acquire the property for rennovation purposes.