As a freelancer, you will be dipping in and out of other people’s businesses and making some big decisions along the way. What you do can have big consequences, so it’s well worth looking into the thorny issue of insurance.
Beginner’s guide to insurance for freelancers:
- Why do you need freelance insurance?
- Main types of freelance insurance
- Do you really need freelance insurance?
- Which insurance company should you use?
- Related articles
Why do freelancers need business insurance?
You need freelance insurance to cover you against liability for any errors or accidents that may happen as a result of your freelancing, which you could otherwise be personally responsible for.
If you’re a graphic designer, for example, you might be designing for magazines that print 100,000 copies. If it has a mistake in it – you don’t want to be personally liable for that cost. That’s why you need to make sure you have the appropriate insurance in place to cover your back. In fact, some clients won’t work with you without it. Don’t worry, freelance insurance is not normally too expensive, and it’s a worthy investment.
Big decisions can have big ramifications if things go wrong. Of course, this is not financial advice and you should definitely do your own research to make sure you understand your specific circumstances.
Main types of insurance for freelancers:
Professional Liability Insurance
This is essentially errors & omissions coverage. You need to get this because it covers claims of negligence, libel or slander, and the costs of any legal counsel you may need. It can be a very lonely place if you don’t have this insurance and something does go wrong.
In the UK and many other countries, if you’re a sole trader, you, legally, are your business, so you can be personally liable. If something goes wrong, your savings and personal money can be on the line.
Public Liability Insurance
If you’re going to be in contact with members of the public, it’s also likely that you’ll need Public Liability Insurance. This will protect you from someone suing your business – basically YOU if you’re a sole trader – if you do something like damaging property or a building. Or if you injure someone.
So if you’re an artist painting a mural, outdoors, for example, and your ladder fell onto someone, for example, this insurance will cover you from this kind of accident. Basically, if you have the potential to harm a member of the public, financially or physically, you will probably want this type of insurance too.
It’s also a good time to think about whether you need to insure your equipment.
Again with all of these, it feels like another annoying expense until you need it.
As an example, I was travelling in Ukraine a few years ago and my laptop suddenly stopped charging.
I didn’t have a backup device, so I was grateful to be able to rely on my insurance to buy a new one immediately without having to worry.
This gave me the freedom to continue working on urgent client work. Without the insurance, I would have been trapped with no laptop and an important deadline flying in at me.
Do freelancers really need insurance?
In some cases, you may be able to get away without being insured. But generally, it’s really not worth the risk. It’s a bit like driving without a seat belt. You will often get away with it, but in the rare occasion it’s required, you’ll really regret not having it.
Also it’s well worth knowing that many clients and freelance job boards will request evidence that you’re insured.
If you’re taking your freelancing seriously, you should definitely be insured.
Which insurance company should you use?
I’ve always used Markel Insurance, and I’ve found them to be a great option offering the cheapest option for robust cover.
I’ve never had an issue with them and they’ve been really good at communicating with me whenever I’ve had questions or queries.
There are plenty of other options out there, but if you want to try them you can use my referral link to get a quote.
Until next time,
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