topic Re: will this effect my personal credit? in Business Credit

will this effect my personal credit?

SantaMar — Wed, 05 Dec 2012 16:31:22 GMT

i had a business idea. i formed an LLC. got a tax ID number. got business insurance. i have not really had any success. im considering canceling my business insurance (90 bucks a month)...i have three months paid. but i was wondering if canceling my business insurance will in any way negatively effect my personal credit? what if im grossly late on my business insurance monthly pay?! my line of thought is if i dont pay they just cancel my insurance, cancel my coverage, throw out my policy....its not like i have i borrowed money to buy a computer and they want their computer back...

Re: will this effect my personal credit?

Brandnick — Wed, 05 Dec 2012 16:48:25 GMT

Rule of thumb

For example things like Credit Cards, mortgages, personal loans, car loans report to CA's. An insurance company will not report to CA on a monthly bases the only time they will report anything is when you don't pay them what is owed and it in collections

So cancel the insurance just make sure all is paid

Re: will this effect my personal credit?

oogy — Wed, 05 Dec 2012 17:33:31 GMT

Don't just stop paying and assume they'll throw out your policy though. Make sure you actually cancel your account. If you simply stop paying without canceling that's how things go to collections and end up negatively reporting on your credit reports.

If you pay what's due and then cancel it completely though, I don't see why that would effect your credit at all.

Also, just because someone is offering a service rather than a physical product does not mean they are going to be less diligent about making sure you pay them for that service.

Re: will this effect my personal credit?

Creditaddict — Wed, 05 Dec 2012 18:15:44 GMT

Insurance $90 a month wihtout a retail location?!

What kind of business, why do you need insurance at all?

Just call up and cancel, should be just like auto... you paid for 90 days and cancel at 75 days, they will send you check for 15 days!

Re: will this effect my personal credit?

SantaMar — Wed, 05 Dec 2012 21:17:50 GMT

the type of business is a transportation/delivery service that caters to a specific industry. im not dissolving the business so the tax id will remain however i havnt agressiveley gained business so im not going to continue my policy. if business spawns new clients moving forward i will re instate of just get a new policy...

Re: will this effect my personal credit?

Project17 — Wed, 05 Dec 2012 23:07:29 GMT

It will not effect your personal credit at all. Even if you owe money and don't pay, the policy was under a LLC thus making the LLC liable for the balance if any. I have never seen ins business insurnce policy that has a PG attached to it.

Just call them up and cancel it and they may owe you money. Usually you put money down so a lot of times you will be owed a refund if you don't have the policy for the full term.