Just formed an LLC in Arkansas for my side gig (woodworking). The Articles of Organization asked for my registered agent, principal office, etc. Now I'm filling out a business insurance application and it's asking for different stuff like annual revenue, payroll, square footage, and even my personal credit score. Why the disconnect? I thought the state would already have all this. Am I missing something?
Insurance
Why does my Arkansas business insurance policy ask for different information than my LLC filing?
They're two different beasts. The Secretary of State just wants to know you exist and who to sue. The insurance company wants to know how likely you are to burn down a customer's decl.
Insurance asks for revenue and payroll because they're pricing risk, not verifying your LLC. The state colud care less if you make $5k or $500k a year.
Wait until they ask for your FEIN and then ask you to prove it with a letter from the IRS. The left hand never knows waht the right hand is doing.
I have a small shop in Saline County. My agent told me the underwriting info is separate from the state filing because the state doesn't share that data. Also, personal credit score? That's normal for small business policies—they use it as a proxy for responsibility.
It's almost like the government and private companies don't coordinate perfectly. Shocking, I know.
Are you sure you're not filling out a life insurance application? Personal credit score for woodworking insurance is a bit odd. But then again, insurers are weird.
It was definitely the business policy—maybe they bundle it with a personal umbrella? Anyway, thanks for the input. I'll just grit my teeth and fill it out.
You might also get asked for your NAICS code. That's the North American Industry Classification System. It helps them classify your risk. The LLC filing doesn't ask for that either.
I once had an insurer ask for my blood type. Okay, not really, but it felt that way.
If you think that's bad, try getting a liquor license. They want to know everything except your shoe size.
If your revenue is low, you might qualify for a small business policy that doesn't require as much info. Ask your agent about a BOP—business owner's policy. It's often simpler.