Many founders of car washes initially underestimate the costs they will incur as a result of the insurance policies taken out when setting up a company. There are a number of them that you must take out, and some others that you are strongly advised to take out. We will provide you with an overview and explain how to select the right insurance policies.
You start your own business with a car wash – this means that you are no longer covered by pension, health and long-term care insurance through your employer. However, you need health insurance, which is required by law. You can choose between voluntary statutory and private insurance when starting up your own business. If you are still unsure about your expected income, you can initially insure yourself for the minimum amount in the statutory health insurance. Your contributions are adjusted as your income rises. Private health insurance companies offer more comprehensive protection, but are also more expensive. The scope of services of the statutory health insurance funds is fixed, the differences here are not huge. With the private insurances, however, you should compare carefully in order to find the best offer for you.
Unlike in permanent employment, as a self-employed trader you are not obliged to take out pension, accident, long-term care or unemployment insurance. However, you are strongly advised to do this anyway. This is the only way you can be sure that you will be well taken care of in old age and that you will not be left helpless in the event of an accident. Occupational disability insurance can also be useful, as can (daily) sickness benefits.
Business liability insurance is also particularly important for you: If property gets damaged or if people are injured in the car wash, the liability lies with you – or with this insurance. It pays if the damage is caused by a failure on your part or by an employee or also by defective goods. Also, make sure your insurance includes environmental liability. If environmental damage occurs in the vicinity of your car wash due to a leak, the resulting costs are also covered.
Business content insurance is also interesting. This replaces your entire operating equipment including machines, devices and equipment, and also the contents of the office as well as all operating materials and goods stored in the facility. They can, for example, be stolen or damaged in a burglary, destroyed by fire or rendered unusable by mains water. Depending on what you also insure, natural hazards are also covered. It is particularly interesting for you as the owner of a car wash that you can also have all the clean-up work covered. This often includes the decontamination of the soil. If oil or chemicals get into the ground from your car wash in the event of damage, it can quickly become very expensive without insurance.
Many self-employed people also take out business interruption insurance together with business content insurance. This pays for the losses that you incur if, due to damage or burglary, the car wash has to remain closed for quite a while until it is ready for operation again. These can quickly mount up, because you are obliged to continue to pay wages and salaries as well as social security contributions for your employees.
Among the insurances that are repeatedly recommended when setting up a business is legal expenses insurance. While there are a number of ways to deal with dissatisfied customers, no one can protect you from litigation. Legal expenses insurance is worth taking out so that in the event of a claim you do not have to bear the costs that a legal dispute naturally entails. You do not have to fear a dispute if you have this insurance.
If you have employees working at your car wash, you pay into the statutory accident insurance for them. This is obligatory and unavoidable. It is a social security scheme which is paid entirely by the employer.
As an employer, you also pay employer contributions to the pension, health, nursing, and unemployment insurance for your employees. In addition, as an employer you are obliged to provide your employees with a company pension plan. Up to 1 January 2019, this meant that you had to somehow give your employees access to it – for example, you could find them an advisor to help them with deferred compensation. In the case of deferred compensation, a certain portion of the monthly income is converted directly into a pension; this also has tax advantages. Since the beginning of the year, as an employer you have been obliged to support your employees with 15 percent of the monthly sum. However, this sum is deducted from their gross salary, so you save on social security contributions. As an employer, you will not be asked to pay any extra in the case of relatively low salaries and contributions. As such, you can kill two birds with one stone. You comply with the requirements of the law and retain competent employees by making provisions for the future.
Many start-up insurances are offered to relatively large groups. One trade can be very different from another. Therefore, you need to consider exactly what you need in terms of business liability insurance as well as business content insurance and business interruption insurance. Online there are indeed comparison websites (e.g. specialised in commercial insurances or to compare different insurances), but in case of doubt you should not be afraid to take advantage of no-obligation consulting discussions. After all, nobody will oblige you to conclude a contract directly after a consultation. Keep in mind that these insurances ideally will be with you throughout your business life!
If you are still thinking about which insurances are suitable for you, the costs are not an insignificant decision factor – especially if you need to watch every penny at the beginning. So give as much information as possible during the consultation. How many people will be working for you, for how long and where exactly? How safe is the facility? Any risk, however small, can have an impact on the contributions.
The same applies if you later submit a claim to the insurance company. For example, have the body shop that repaints a car that has been scratched in your car wash give you a precise list of all material and labour costs. If something is overlooked here, you will be stuck with the costs later!
It may be a topic that you are not particularly interested in, but which insurance policies you take out when starting up a business can be decisive for the success or failure of your business. Think in advance about the risks involved in a car wash and in which areas you would have to take out insurance simply because the damage sums involved could ruin you. Talk to consultants and insurance brokers. In no-obligation discussions you can find out which conditions are offered before finally choosing the best for you.