Limited Liability Insurance
limited liability insurance
Liability if you are on the car registration as co-owner?
If a co registered owner of a car which his unlicensed cousin (other co-registered owner) was driving DUI and killed someone (my son) are both parties liable.? This is for the state of Washington. The cousin had limited insurance $50K however the co reistered owner does have assets.
Insurance coverage is complicated, but this is something that reverts back to a more common sense answer. Insurance is considered to “follow the vehicle” in most cases and the vehicle owners insurance is primarily responsible for damages. Both owners will not be required to carry insurance on the vehicle though. If the one who primarily drivers the vehicle has insurance on it, then the law has been satisfied.
The one who caused this loss, considered the tortfeasor, would be the person named in any suit(no matter who’s insurance covers the vehicle). Most all states see that it would not be fair to punish a party that is not responsible for the loss(the co-owner) unless they contributed to this loss in some manor. Now anyone came be named in a suit but that does not mean that the suit will prevail. The most common example of a co-owner being sued for additional damages is when they are the parent or guardian of the driver(and the co-owner or sole owner) of the vehicle and a suit is brought for negligent entrustment(stating that the parent and co-owner should have known about the drivers propensity to drive under the influence.) If the driver had a history of DWI then this suit may be successful.
Insurance Information : What Is Limited Liability Insurance?
Forming a Professional Limited Liability Company
Limited liability companies offer small businesses and their owners a wonderful way to minimize liability and their taxes. But the rules for when and how a professional forms a limited liability company are complicated. To make the process smoother and less burdensome, use these tips:
Tip #1: Verify Your Profession Needs (and Can Form) a Professional Limited Liability Company
State law determines whether individuals and firms practicing your particular profession in your state can form a limited liability company, or LLC.
State law also determines whether people in your profession need to form a regular limited liability company or a professional limited liability company.
Accordingly, the first step in forming an LLC is to determine whether you even can form a limited liability company and (if you can) whether you need to form regular LLC or professional LLC.
You should be able to determine this by calling the state agency or affiliated organization that grants your professional license. For example, if you’re an attorney, you probably call the state bar association. And if you’re a certified public accountant, you probably call the state board of accountancy.
Note: You can also look at what other professionals–doctors, dentists, and so forth–in your state do. But be careful about assuming that what other people are doing is correct. Sloppy professionals (sadly) regularly form an LLC when by law they’re supposed to form a PLLC. This mistake, by the way, probably destroys the liability protection that the LLC offers.
Tip #2: Clearly Identify Your LLC as a Professional Limited Liability Company
Typically, you form a professional limited liability company in the same way as you form an LLC. You simply file articles of organization or articles of formation with the secretary of state.
One difference between forming a professional limited liability company and forming a regular limited liability company concerns the name, however. Any limited liability company needs to clearly identify itself as a “limited liability” entity.
A regular LLC needs to clearly and plainly identify itself using an acronym like “LLC” as part of the entity name, for example. Or by using a phrase like, “limited liability company,” as part of the name.
Naming a professional limited liability company works similarly–but you need to use an appropriate professional LLC acronym or phrase. In most states, the acronym PLLC works. However, all states that allow professional limited liability companies also let you use other acronyms and phrases, such as “Professional Limited Liability Company,” “Professional Limited Liability Co.,” or the abbreviation “P.L.L.C.”
Tip #3: Verify LLC Owners Hold Appropriate Professional Licenses
A quick, probably obvious point: In general, the owners of a professional limited liability company need to hold appropriate professional licenses to be members in the professional LLC.
For example, a PLLC that practices public accounting needs its owners to hold professional licenses to practice public accounting. A PLLC that practices law needs its owners to be members of the state bar.
Note: In same states for some professions, a PLLC may be able to have minority owners who don’t hold professional licenses. Check with the appropriate state agency for more information.
Tip #4: Verify You Follow Any Other Naming Rules for Your Profession
In same states for same professions, the licensing state agency also has other naming requirements for professional limited liability companies. For example, the name of the individual professional or professionals may need to be used in the PLLC name.
You’ll want to check out this possibility for your state for your profession–and then (obviously) follow the rules prescribed.
Tip #5: Secure Professional Liability Insurance, If Required
A final and often missed PLLC setup step needs to be considered–the step of securing professional liability insurance.
Some states require that professional limited liability companies acquire a professional liability insurance policy, bond or other evidence of financial responsibility in order to get liability protection from the PLLC form. The professional limited liability company, for example, might commonly be required to obtain and maintain at least one million dollars of insurance or bonding coverage.
