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Thread: Do photo clubs need insurance, incorporation?

  1. #21
    Drew Wiley
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    Re: Do photo clubs need insurance, incorporation?

    I think it's nuts to have any kind of work collective without at least liability insurance. This IS California I'm speaking about. We have lot of great white sharks patrolling offshore, and lots of ambulance chasers on shore. They gotta eat too.

  2. #22

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    Portland, OR USA
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    Re: Do photo clubs need insurance, incorporation?

    Our group is insured. We hold public events and even serve wine at show openings. Better safe than bankrupt.

  3. #23

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    1,210

    Re: Do photo clubs need insurance, incorporation?

    Yes, but if I understand what liability insurance does is pay for injury or damage to non-members or a meeting site.
    It seems incorporation protects individual officers and members from lawsuits.
    Is this correct?

    I'd like more info, if anyone having a policy could provide me contact info for a provider.
    Real cameras are measured in inches...
    Not pixels.

    www.photocollective.org

  4. #24
    Drew Wiley
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    Re: Do photo clubs need insurance, incorporation?

    Anybody can hypothetically sue anybody else for anything. Just depends on whether the circumstances make Pavlov's lawyer salivate or not. There are plenty of
    online guides outlining when incorporation makes sense and when it doesn't. You need to generate significant income from an enterprise, for one thing. But before
    you get carried away, it is best simply to review whether the basic property insurance coverage itself carries relevant injury liability clauses. Common sense is the best first line of defense. The next basic step is to pay a trusted lawyer to review your insurance and co-op contracts and look for any serious loopholes. That usually involves a small token fee. No big deal. You also have to find some way of filtering who can and can't join, so Rasputin can't simply walk into your life. But
    this is a little more tricky unless the whole nine yards is tightly held. Once again, get some coaching with a lawyer familiar with these specific kinds of scenarios.

  5. #25
    Drew Wiley
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    Re: Do photo clubs need insurance, incorporation?

    ... But a lot also has to do with the nature of the facilities themselves. If your club is just temporarily renting a gallery space, for example, they on their behalf should provide you with a copy of their relevant coverage. On the other hand, if you're getting involved in a long-terms lease involving any kind of shared craft space, likea collective darkroom, you need to be very careful about what the property owner is responsible for, and what you are. And common sense dictates that everything
    possible be done to make the area safe, up to code, and even ADA legal. You also have to be aware of what any immediate neighbors are like. For example, I'd never set up a gallery or quality workshop adjacent to any restaurant or garage - just too risky. We had a wonderful craft collective down the street completely
    burn down due to a bunch of idiots adjacent, with a lot of careless wiring. I've witnesses that scenario more times than I can count.

  6. #26

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    Re: Do photo clubs need insurance, incorporation?

    Quote Originally Posted by dsphotog View Post
    Yes, but if I understand what liability insurance does is pay for injury or damage to non-members or a meeting site.
    It seems incorporation protects individual officers and members from lawsuits.
    Is this correct?

    I'd like more info, if anyone having a policy could provide me contact info for a provider.
    I don't think the liability is limited to only members. That insurance should cover anyone who would be included under its' coverage.

    We do many of the major trade shows like the Photo Plus Show in NYC, PMA/CES, NAB, Rangefinder, etc. And for all of these, or most of them, we need to have an insurance policy that covers attendees and particpants at the show and name the show sponsors on the policy.

    While nobody has ever tried to collect on our policy it brings up an interesting question. You mentioned covering non-members and left out members.
    So, we have our own booth within the trade show. Attendees at our booth range from the general paying public, who paid to get into the show, people from the general public that received free trade show passes from us or other distributors/manufacturers/exhibitors, employees of the exhibit facility, employees of other exhibitors who are looking for our products, wifes/girlfriends/husbands/boyfriends/friends on any of the people listed below.
    Our understanding is that anyone that is injured in our booth or by our products displayed in our booth is covered by the mandatory policy that we have to take out for the show. Why would your members not be covered?

    Just because you are an officer of a corporation does not mean that you can't be sued. A liability attorney is going to sue everyone. He might only collect from the deep pockets but your defense of a suit could cost more then settling the dispute.

    An example:

    Back in the 70s through the mid 80s a group of photgraphic manufacturers and distributors banded together and put on 6 photo exhibitions a year with a trade show, gallery and classes on photo. These were done in 6 different cities each year throughout the USA. To co-ordinate this the group (called IPOSA for the International Photo Optical Shows of America) hired an experienced show director and his wife. Each of the companies paid an annual fee (based on the size of their display space at the shows) and, at the end of the year, any profits from show admissions, food, etc. were split between the companies and any additional expenses not covered by the annual dues, show proceeds, etc. were then shared equally by the exhibiting members.

    This was quite a successful arrangement and went on for several years with no problem. But then the attendance at the shows began to drop pretty quickly and by 1984 or 85 we gave notice at the end of the year that we would no longer be a memebr and would no longer exhibit at the shows beginning 1/1 of the following year.
    The shows went on for one or two more years but it was then discovered that the show director was diverting funds for his own use and that there was a considerable amount of monies owed to the show decorator (that is the company that sets up the booths, carpets the halls, brings the merchandise to and from the freight dock, store the empty containers, vacuums the floor, etc.) and they then sued the member companies. Including us who had dropped out previous to the rounds of shows that created the shortfall.
    Yes, the Sheriff did knock on our door, smoking a cigar, in a baggy suit and an old hat and did hand me the papers naming us as defendants in the suit for something that occured after we formally and properly had left the group.
    Our share of this shortfall was around $5,000.00. Our attorney told us that we had a highly defensible position. But it would cost us more then the amount that we were being sued for to defend that position. We elected to settle and pay the $5,000.00.

    o, we were sued because we had belonged to an organization, that the director of that organization embezzled funds after we had left that organization and that the party that was owed money because of that embezzlement sued all former and current memebrs of that organization and it was cheaper to pay then to defend ourselves.

    Just because you are an officer or a member doesn't mean someone can't sue you.

  7. #27
    Drew Wiley
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    Re: Do photo clubs need insurance, incorporation?

    Lucky the IRS didn't go after each and every one of you. That's been know to happen too. Gotta read the fine print with them also whenever anything involves a
    contract. All it takes is one bad apple.

  8. #28

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    Re: Do photo clubs need insurance, incorporation?

    Quote Originally Posted by Drew Wiley View Post
    Lucky the IRS didn't go after each and every one of you. That's been know to happen too. Gotta read the fine print with them also whenever anything involves a
    contract. All it takes is one bad apple.
    IRS had nothing to go after us for. Everything was reported and any taxes due were paid. The only one to get stiffed was the decorator and they got their monies when they sued the organization and the members and former members.
    What their attorney did was go back several years and sue anyone who had been a member previously since the membership by the time of the suit was very small and future shows had already been cancelled.
    So, since we had been a member we also got named in the suit.

  9. #29
    Drew Wiley
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    Re: Do photo clubs need insurance, incorporation?

    Doesn't matter - if just one participant acquired income illegally and didn't report it, the IRS has been known to go after everyone in the membership. It happened to my own brother. Yeah... he, along with all the other innocent partners, finally beat the IRS in court - but there went ten years of his life, and they of course held his the money in the meantime - had to pay it back with interest, so it still inflicted quite a burden. It happened to someone right on the next block. He lost everything - his shop, his equipment seized, basically his living taken from him due to something a partner did, not him, analogous to what you're describing. I'm not stating this to start an argument over IRS practices, but simply to point out how any kind of group contract needs to be reviewed by someone knowledgeable before you sign. All these various areas of law get complicated. Nowadays most trade show venues carry a full package contract, including all the necessary loss and liability insurance for the duration of the event, and it's not elective. And they charge dearly.

  10. #30
    Moderator
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    Re: Do photo clubs need insurance, incorporation?

    Quote Originally Posted by dsphotog View Post
    Yes, but if I understand what liability insurance does is pay for injury or damage to non-members or a meeting site.
    It seems incorporation protects individual officers and members from lawsuits.
    Is this correct?

    I'd like more info, if anyone having a policy could provide me contact info for a provider.
    Basically, yes.

    Rick "any commercial insurance agency will know what you need" Denney

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