LLC Business insurance requirements?

For the most part that is correct.

Sorry for having not read any other post but are you looking at having company drivers or more than just you? Most independents don't need an LLC unless their is something different happening.

 

An LLC is a good idea for any business, as with a sole proprietorship you have a business in your mind only. That is verbatim from a CPA I talked to years ago. An LLC provides the best set up, since you can choose any of the 4 tax entities . . . sole proprietorship, partnership, S-corp and full corp. My hubby and I have ours set up with both of us as managing members of the LLC and taxed as a partnership. The FMCSA has the information on the minimums you need for the insurance they track and your agent should know what you need on the others.

 

Is business insurance mandatory? I thought insurance was mandatory to get your authority?

 

I would avoid an LLC because the entire purpose of one is to limit your liability which in this business you really can't.

Sole Proprietorship is the same as an LLC when you use it for tax purposes, having a spouse being a business partner has little tax savings unless you are filing separately.

A good accountant, not a tax prepayer, will guide you towards a useful entity that you can better use.

 

That advice might be alright if you're leased on to a motor carrier, but if you are going to be a motor carrier that is absolutely wrong and very bad advice. Based on the insurance question I think the OP is going to apply for motor carrier operating authority. Operating as a motor carrier as a sole proprietor is needlessly taking on a significant amount of risk to personal assets. While a leased owner operator is primarily limited to the risks involved with a vehicle crash a motor carrier faces other risks/liabilities such as cargo claims and contract terms. Insurance doesn't always cover cargo claims or other incidents, but the carrier may still be liable for them, in which case the carrier must pay from its own funds. It wouldn't be hard, or unheard of, to have a cargo claim of a significant sum of money which is not covered by cargo insurance.

For an introduction to motor carrier legal issues, I recommend a book that should be read, studied and thoroughly understood by anyone getting or having operating authority titled Protecting Motor Carrier Interests in Contracts available at http://seatonandhusk.blogspot.com/p/book-order.html

 

While you are reading, research piercing the corporate veil.

 

And if you conduct your business right why would the corporate veil be pierced?

 

Just read it.

In a perfect world you would not. Have an incident.