There are a lot of insurance types: liability, disability, and property to name just a few. As you start your freelance business, you want to follow all the rules. But what do you really need freelance insurance to cover yourself?
Freelance insurance may make you feel more professional, but that doesn’t mean it’s something you need to legally start a freelance business, particularly when you’re selling your services to other businesses.
Of course, if you sit down with someone in the insurance industry, be prepared for them to tell you that you absolutely need insurance. Of course they are! They sell insurance! So, do your research and go with what gives you peace of mind.
Here’s some popular examples of types of insurance and how much sense they may make for you as a freelancer.
General Liability Insurance
On the surface, this might lead you to believe this protects you against lawsuits. But, that’s not really what it does. Mainly, this type of freelance insurance would protect you from accidents that happen on your property, like if a client slipped and injured themselves in your driveway.
However, clients are never actually on your property! It’s so easy for both you and your client to meet virtually through Zoom or Google Meet, rendering liability insurance pretty useless for freelancers. And, if your client would rather meet in person, you can just meet them at their office.
Professional Liability/Indemnity Insurance
This type of insurance covers any legal cost you might incur if a client were to claim a financial loss due to negligence on your part.
At first, it may seem like you should consider this one. But, the fact is your client ultimately approves or disapproves of your services. So, once they approve your work, the liability falls to them. Any errors or problems that might lead to financial loss would be their responsibility.
Of course, and this should go without saying, you’re always putting your best foot forward. If you’re writing copy, you’re not blatantly making claims you know are untrue. Or if you’re a graphic designer, you’re not using copyrighted images without permission.
Disability Insurance
As far as freelance insurance goes, this may be the type you’d want to think about, if it’s financially feasible for you.
As you consider if you should have disability insurance or not, think about what would happen if you were ill or injured and couldn’t work for an extended period of time. Would your family be able to make it financially while you were unable to work? If not, you might want to look into both short and long term disability insurance to help make up for the lack of income your injury or sickness causes.
Most of the time, freelance insurance isn’t something that you’re going to need in your career. But, every career and situation is different. So, if you feel like it might be necessary in your career, don’t hesitate to speak with a professional. At the end of the day, the best choice is the one that gives you peace of mind!
Did you decide to get freelance insurance of any type for your business? Tell us why or why not in the comments!
Note: We are not legal experts or tax preparation professionals, so always consult an accountant, tax prep professional, or attorney if you have concerns. This information is aimed at freelancers in the United States. If you want to legally start a freelance business in other locations, you may find this information useful for determining what questions to ask and answer based on your city, country, or region.
Last Updated on July 1, 2023.
