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LLC’s and you, not necessarily perfect together?

By March 9, 2017September 20th, 2019No Comments

Limited Liability Company [LLC] owners, referred to as members, have the authority to sign contracts on behalf of the LLC.

Question: So, does that mean that an owner, or member, can be sued personally?

Answer: Of course you can.

Although an LLC is oftentimes created to protect a member from insuring personal liability for a breach of contracts, they are typically limited to protection from commercial leases, bank loans, and invoices for products and/or services provided from the LLC’s vendors. What it does not protect these owners against are liabilities that may occur in connection with business operations.  An LLC owner who is simply negligent in an auto accident, such as being at fault while driving on company business, is liable for the property damages and personal injuries resulting from the accident.  “Piercing the corporate veil” is a popularized solution to make an owner liable, and without the proper insurance products in place, it can cause a litany of financial claims against you.  Click on the image to the right that shows how personal negligence in business can lead to jail when the improper insurances are in place.

Obviously the LLC entity should have its own insurances in place, but did you know that you should be making sure that your own personal insurance is in place for an ultimate fallout?  Is your current insurance plan in place sufficient to prevent suffering personal liability claims that are the result of a business endeavor?

Gather your files and reach out today.