I recently attended an event at which I asked hundreds of DJs if they had business insurance. Many told me their “Boss” had them covered. I then asked if they were paid by W-2, 1099, or CASH when being a subcontractor. If they answered ‘W-2″ they were golden and did have protection from their employer’s insurance. However, almost 75% told me they were paid 1099 and 15% said ‘CASH’ with a smile. By definition, a subcontractor means a separately owned company with different ownership. We all know a liability insurance policy cannot be shared. Those DJs realized they did not have the insurance in place they had hoped would protect them.
Working as a separate entity…subcontractor, really means their boss’s company would have coverage for a claim caused by that DJ they sent to a gig but that insurance policy would not extend to protect the DJ that actually caused the claim.
Over a 3 day period speaking with DJs for 16 hours, there were at least 40 DJs that truly thought they we protected but were actually uninsured. While insurance premiums absolutely are a bad medicine annual expense, a $175 annual minimum premium for liability coverage works out to be less than an hour of a lawyer’s time while you explain why you need to hire that lawyer for what turned out to be an unexpected uninsured insurance claim. Not one DJ I spoke with felt that amount was too expensive for real protection they controlled. It felt good being able to educate so many DJs to council they in protecting their financial wealth.