You may see companies advertising everywhere that they are licensed and insured. That gives many consumers peace of mind that the company is legitimate and if there are any catastrophes, the company has the proper insurances to pay for such damages.
Perhaps you are starting a company and have heard that your company must be licensed and insured. Whether you are building homes, providing a service, or selling goods, you’ll need the proper license and insurance to do so. While most people have heard these terms, they couldn’t tell you exactly what it means for a company to be licensed and insured or why it’s necessary.
Here’s what it means for a company to be licensed and insured and why it’s vital.
A company being licensed can mean different things in different states by industry. A business license is supposed to signify the professional skill and ability to provide the service offered. This not only sets consumers at ease, but it is often required by states and localities. Operating a business without the proper license can be grounds for significant fines, closing business doors, and sometimes even jail time.
Licensing requirements not only differ by locality and state but by industry as well. Some trades may require little more than registering with the municipality and paying a predetermined fee. Other professions may require exams, continuing education, or other ways to prove one’s ability before a license is issued. The level of specialization and state boards can also affect licensing requirements in different areas.
Getting licensed and insured often go hand in hand for many industries. Rarely do you see one without the other, but it does happen. Licensing protects the interests of potential and current clients while insurance protects the interests of the business. Insurance requirements may differ by state and by industry. There are some insurance requirements in place which protect the interest of potential clients or consumers.
For instance, physicians must carry malpractice insurance while tradesmen typically must carry general liability and workers’ compensation insurance. Insurance requirements differ based on the industry and services provided by the company. Sometimes, a company may be required to show proof of specific insurances to get their business license. The price of insurance will vary based on the industry, the number of employees, and the services rendered.
Get Your Company Licensed and Insured Today
If you are paying for a service to be performed, you’ll want to ensure the services are being rendered by a company or professional that is licensed and insured. This is for your own protection as well as the protection of the company. Being licensed and insured demonstrates the ability to perform the services offered and it is vital in the course of business today.
They can help you take the necessary steps to ensure your company is operating properly with all the necessary licenses and insurances. Make that call and get your company licensed and insured today.