Hunter NelsonOwner of Nelson Insurance Agency

Setting Up an LLC: Requirements & Insurance Explained

27 Mar 2026 · 1 min

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In this instructional video, Hunter Nelson advises viewers on forming a Limited Liability Company (LLC) versus operating as a sole proprietor, emphasizing that an LLC is a popular and advantageous option. He outlines that state certification requirements vary: some states have none, while others, such as Colorado and possibly Pennsylvania, mandate general liability insurance with proof of $1 million coverage. He clarifies that the "million‑dollar liability" requirement does not refer to a single blanket policy; instead, businesses must secure three distinct insurance policies that together satisfy the $1 million liability threshold. The video serves as a practical guide to navigating state-specific certification and insurance obligations when setting up an LLC.

Chapters

Set up an LLC. LLC is a good option. A lot of people are setting up LLCs, or, you know, or you can go as a sole proprietor, whatever you like to do there. Here are state certification requirements. So you see some states do not have them at all here. And then you can see that other states will be accepted. You know, certain states here, you are going to have general liability be required for the state. There is more than just Colorado. I'm blanking out here right now. I want to say Pennsylvania is one of them, if I'm not mistaken. I'll have to double-check that. I'm blanking out here at the moment, but I know it is more than just Colorado needs a million dollars. And it says proof of million dollars liability. You're gonna have 3 different million-dollar liability policies. Million-dollar liability insurance is not a thing. It is not a blanket million-dollar liability. There'll be 3 different types of insurance you guys need.