[Catwoman52]

I'm thinking of starting a service oriented business that would be conducted at an individuals private residences. Light repair, upkeep, etc.

My husband and I would be the only employees. Do I need to be licensed, bonded and insured. If so, why and what must I do to achieve that status? Is it expensive to be bonded and insured. I guess I would, of course already have a business license.

Thanks for your help

[Clough]

One of the things that I do for a living is that I am a handyman. It sounds like that is the area of work in which you are going to be involved. Where I live, a handyman does not need to be licensed. So, whether you need to be license depends on the laws governing the sort of work you do.

Where I live, being bonded or not is up to the individual. There may be laws where you live that cover that also. I recently asked my attorney how I would go about being bonded, and he suggested going to an insurance agent. I don't know about the cost of being bonded.

I do, of course, have insurance. I went to an insurance agent that works with many carriers in order to get the carrier who's coverage was best suited to what I do. If you go to a small insurance office, chances are that they will not have a lot of carriers. So, your selection is smaller. Also, some companies will not insure you unless you have been in business for a certain length of time. A suggestion would be to see if there is realty office in your area that also has an insurance carrier section to the company. Chances are that they will have many carriers. That is how I got my insurance. My insurance costs about $425.00 per year. I make the payments for about $85.00 per month for a period of five months.

Having a license to be a handyman and being bonded where I live, might make me look better in the eyes of some, but it is not necessary. To be sure of what you need to have in your area, I would contact a home inspection division at a city hall, or whatever building they happen to have there offices in. I do plan on being licensed and bonded.

If you are going into that kind of business, then chances are that you will be getting into working on apartments for people. Then you will need to know the city codes concerning how things need to be repaired, etc. in an apartment. Again, see inspection division. Also, any kind of electrical or plumbing work done in an apartment may need to be done by someone licensed to be a plumber or electrician.

I know that you have not asked this question, but advertising is very important. I get more jobs because of the ads I have on the Internet than for those that I have in the local Yellow Pages of the phone book. To see examples, just type in Clough Quad Cities in a Google search, or using any search engine for that matter, and you will see examples of my ads all over the place for the various things that I do for a living. Every ad that you see concerning me is FREE. You may want to do the same kind of thing.

One last thing, and again, I don't know where you live. But, where I live, if I had any employees, then I would need to pay for the type of insurance that concerns workmen's comp. It can be very expensive. So, as long as you are just working together and not as an employee of one another, you do not need to have workman's comp.

[Catwoman52]

Clough -
This information was very helpful. Thank you, for taking the time to respond so thoroughly. We live in Arizona and I haven't begun to research what if any special city codes, etc. might exist but I'll take your advice and start with the city hall.
Also, I appreciate very much the tip about advertising. My mind hadn't embraced that obvious need yet. I know it is usually a big expense so your suggestion is just great!
Thanks again!

One of the things that I do for a living is that I am a handyman. It sounds like that is the area of work in which you are going to be involved. Where I live, a handyman does not need to be licensed. So, whether or not you need to be license depends on the laws governing the sort of work you do.

Where I live, being bonded or not is up to the individual. There may be laws where you live that cover that also. I recently asked my attorney how I would go about being bonded, and he suggested going to an insurance agent. I don't know about the cost of being bonded.

I do, of course, have insurance. I went to an insurance agent that works with many carriers in order to get the carrier who's coverage was best suited to what I do. If you go to a small insurance office, chances are that they will not have a lot of carriers. So, your selection is smaller. Also, some companies will not insure you unless you have been in business for a certain length of time. A suggestion would be to see if there is realty office in your area that also has an insurance carrier section to the company. Chances are that they will have many carriers. That is how I got my insurance. My insurance costs about $425.00 per year. I make the payments for about $85.00 per month for a period of five months.

Having a license to be a handyman and being bonded where I live, might make me look better in the eyes of some, but it is not necessary. To be sure of what you need to have in your area, I would contact a home inspection division at a city hall, or whatever building they happen to have there offices in. I do plan on being licensed and bonded.

If you are going into that kind of business, then chances are that you will be getting into working on apartments for people. Then you will need to know the city codes concerning how things need to be repaired, etc. in an apartment. Again, see inspection division. Also, any kind of electrical or plumbing work done in an apartment may need to be done by someone licensed to be a plumber or electrician.

I know that you have not asked this question, but advertising is very important. I get more jobs because of the ads I have on the Internet than for those that I have in the local Yellow Pages of the phone book. To see examples, just type in Clough Quad Cities in a Google search, or using any search engine for that matter, and you will see examples of my ads all over the place for the various things that I do for a living. Every ad that you see concerning me is FREE. You may want to do the same kind of thing.

One last thing, and again, I don't know where you live. But, where I live, if I had any employees, then I would need to pay for the type of insurance that concerns workmen's comp. It can be very expensive. So, as long as you are just working together and not as an employee of one another, you do not need to have workman's comp.

[Clough]

One thing that I didn't mention was the thing about how to get a license. I am investigating that myself. Where you live, I would start with a Google search for obtaining Arizona buisiness or obtain Arizona buisiness license.

An insurance agent or people at city hall should also be able to guide you in the proper direction.

Advertising doesn't have to be expensive. My only one that I would consider to be expensive would be I'm ads in the Yellow Pages.

I have some definite thoughts on other ways to advertise and would be glad to share them with you. But, right now, I got to go. Will be back later.

[RichardBondMan]

There are two general catergories of bonds, surety (which is not insurance) and fidelity (which is insurance). Surety bonds can be for contractors (license, permit, bid, performance), public officials (Governor, Asst Atty General, Notary), auto dealers, auctionseers, talent agents, mobile home manufacturers, owners of lost bank CDs or stock certificates, owners of vehicles who can't get proper title, hunting & fishing license sales agents, those wanting a firearms permit, etc, etc, and are always required by some city, town, county, parish, state or even the Federal govt or even other contractors or even banks. They are not insurance but are much like an alleged criminal bail bond in that should the principal (the individual or company being bonded), default on any requirement set form by the terms of the bond or the law that required the bond then the bond amount or a lesser amount is forfeited to the obligee (the govt entity, the bank, etc). The surety (the insurance company) then seeks recovery of any monies paid due to the default of the principal usually plus attorney and other fees required to collect the amount paid. Therefore surety bonds are not contracts of insurance where for example, one presents a claim, the claim is paid and the insured is not expected to pay the money back. Fidelity bonds are true contracts of insurance in that should the insured experience a loss of either property or monies caused by a dishonest employee, the employer (thei insured) then files a claim much like a claim for damage to an auto or home or business and the claim is paid - no need to pay back the insurance company.

I would check with the State where you plan to work, also the county or parish you plan to work in and each city or town that you plan to work in. Each may or not require a surety bond depending on their ordinances. Each State, City, etc has their attorney draw a bond form or bond instrument that mentions briefly what kind of work you will be involved in, the amount of the surety bond that the ordiance requires, the cancelation provision, etc, but some few cities and especially small towns don't have a specific form and they will accept a bond form supplied by the surety. The cost of the bond is probably $100. Per year for the type of work you described. Remember each State, City, town, county may or may not require a surety bond.

As to fidelity bonding, there is no bond you need since you do not have employees that will be dishonest and who can cause you a loss. No govt entity requires this, it's just available if you have employees who have access to your property or money. However, there is on the market a miscellaneous type of "fidelity" bond which is commonly called a "third party" fidelity bond that would cover dishonest acts caused by employees that cause a loss of money or propety to one of your customers. If, for example, you employed someone and he illegally stole money, property while doing work on your customers property. This kind of bond usually has a conviction rider in it that really means that your customer just cannot "accuse" your employee of a dishonest act but must seek conviction in a court of law for payment to made to you, the employer. It's freely written (due to the conviction rider and prior experince of most insurance companies) and is not expensive at all.

Hope this info helps you, the others who have answered and also those who might read this post.

Please let me know if my information helped you.

[Catwoman52]

Thanks for taking the time to respond. I found the information very helpful.

There are two general catergories of bonds, surety (which is not insurance) and fidelity (which is insurance). Surety bonds can be for contractors (license, permit, bid, performance), public officials (Governor, Asst Atty General, Notary), auto dealers, auctionseers, talent agents, mobile home manufacturers, owners of lost bank CDs or stock certificates, owners of vehicles who can't get proper title, hunting & fishing license sales agents, those wanting a firearms permit, etc, etc, and are always required by some city, town, county, parish, state or even the Federal govt or even other contractors or even banks. They are not insurance but are much like an alledged criminal bail bond in that should the principal (the individual or company being bonded), default on any requirement set form by the terms of the bond or the law that required the bond then the bond amount or a lesser amount is forfeited to the obligee (the govt entity, the bank, etc). The surety (the insurance company) then seeks recovery of any monies paid due to the default of the principal usually plus attorney and other fees required to collect the amount paid. Therefore surety bonds are not contracts of insurance where for example, one presents a claim, the claim is paid and the insured is not expected to pay the money back. Fidelity bonds are true contracts of insurance in that should the insured experience a loss of either property or monies casued by a dishonest employee, the employer (thei insured) then files a claim much like a claim for damage to an auto or home or busness and the claim is paid - no need to pay back the insurance company.

I would check with the State where you plan to work, also the county or parish you plan to work in and each city or town that you plan to work in. Each may or not require a surety bond depending on their ordinances. Each State, City, etc has their attorney draw a bond form or bond instrument that mentions briefly what kind of work you will be involved in, the amount of the surety bond that the ordiance requires, the cancelation provision, etc, but some few cities and especially small towns dont have a specific form and they will accept a bond form supplied by the surety. The cost of the bond is probably $100. per year for the type of work you described. Remember each State, City, town, county may or may not require a surety bond.

As to fidelity bonding, there is no bond you need since you do not have employees that will be dishonest and who can cause you a loss. No govt entity requires this, it's just available if you have employees who have access to your property or money. However, there is on the market a miscellaneous type of "fidelity" bond which is commonly called a "third party" fidelity bond that would cover dishonest acts caused by employees that cause a loss of money or propety to one of your customers. If, for example, you employed someone and he illegally stole money, property while doing work on your customers property. This kind of bond usually has a conviction rider in it that really means that your customer just cannot "accuse" your employee of a dishonest act but must seek conviction in a court of law for payment to made to you, the employer. It's freely written (due to the conviction rider and prior experince of most insurance companies) and is not expensive at all.

Hope this info helps you, the others who have answered and also those who might read this post.

Please let me know if my information helped you.

[Catwoman52]

Hello again, When you have time, I would appreciate hearing any other advertising ideas you might have.

Thank you

One thing that I didn't mention was the thing about how to get a license. I am investigating that myself. Where you live, I would start with a Google search for obtaining Arizona buisiness or obtain Arizona buisiness license.

An insurance agent or people at city hall should also be able to guide you in the proper direction.

Advertising doesn't have to be expensive. My only one that I would consider to be expensive would be im ads in the Yellow Pages.

I have some definite thoughts on other ways to advertise and would be glad to share them with you. But, right now, I gotta go. Will be back later.

[RichardBondMan]

I wished I could find an easy simple way to explain bonds, boinding, but it's not something most people are familiar with and are not involved with on a regular basis. The field is often misunderstood even by cities that require bonds and even by some insurance agents who issue / or entertain applications/ questions about bonds.. Please let me know if I can be of any further asistance and thanks for letting me know I helped somewhat.

[Clough]

Dear Catwoman,

I will get back with you on Sunday evening concerning ways to advertise that are very inexpensive and visible to people.

Always glad to help out another entrepreneur.

Take care!

Clough

[Catwoman52]

Okay, thanks!

I wished I could find an easy simple way to explain bonds, boinding, but it's not something most people are familar with and are not involved with on a regular basis. The field is often misunderstood even by cities that require bonds and even by some insurance agents who issue / or entertain applications/ questions about bonds.. Please let me know if I can be of any further asistance and thanks for letting me know I helped somewhat.

[Clough]

Dear Catwoman,

I had said that I would get back to you on Sunday evening concerning advertising. Well, I had a music gig out of town today. If someone is still up at this hour, it could still be considered to be Sunday!

I hope that you have checked out my various ads for my businesses by typing in "Clough Quad Cities" in a Google or other search engine search. That should give you some idea of how to word your ads. Any site on which you find my ads is a good site on which to advertise. I have tried probably the bulk of the free advertising sites. Some of them do not get good exposure when searching on the search engines. You need to actually be on the sites to see the ads.

Hanging out your shingles - I type my ads on postcard templates and create four ads per sheet. If you would like examples, I will send them to you. I spend some Sunday afternoons just hanging out my shingles, usually taking friends with me for the ride. It is all tax deductible. These would be anywhere that I can find a public bulletin board where I can post them - libraries, grocery stores, laundry mats, bowling alleys, quick mart type places, etc. I keep track of the places where I have placed my ads. I like to use card stock for shingles. Doesn't blow around in the wind as much. Also, small and colorful is better. May not be much room on a bulletin board because of everything else that has been placed there. I also like to use thumb tacks that do not stick out, so that someone else will be less likely to steal my thumb tacks to place their own ads because flat thumb tacks are harder to remove. I am always respectful of other people's ads for their businesses.

Some neighborhoods also might have public bulletin boards. As well as small towns - maybe just out in the open.

Some small towns have small newspapers where you can place ads for very little expense. Like maybe $5.00 for a business card size ad.

Always carry business cards with you. Bring up what you do as a service in any conversation that you have with people.

You could send out a bulk flyer by the U.S. Postal Service to possible target areas like where affluent people live.

Apartments - Find a list of all apartment complexes in your area within a reasonable distance to travel in order to do your work. See the owners or managers in person and inform them as to what you can do for them. Some of the apartment complexes will have an office where you can find a manager or find out who the owner is so that you can contact them by the mail or email.

Advertise specials on the Internet around certain times of the year - Christmas, St. Patrick's Day, Labor Day, Mother's Day, July 4th, Easter, etc. Type in Valentine's Day Gift Baskets in a Google search. You will find my ads. I beat all of the florists in my area.

One of the tricks is for people to find you be accident. Someone found me by looking for goats in Iowa once (they are an animal rescue) and, decided to have their piano tuned.

I hope that the foregoing has been helpful to you.