Over the past couple of years, freelancing in the self-employment world has grown in popularity. This is the type of self-employment where a person’s job is on a per project or contract basis. Freelancing has a lot of benefits, and also a lot of hurdles to jump through to make a business successful.
Just like any kind of self-employment, freelancers must pay for their own insurance, both health insurance and business insurance. They will never experience the joy of a paid day off or the security of sick pay. However, freelancers do get a lot of perks, such as the flexibility of deciding their own work schedule and environment, the freedom of choosing their clients, and the reward of taking home all the profits. Basically, a freelancer is completely responsible for the success – or failure – of their business.
The type of business insurance a freelancer needs will depend on the kind of jobs their business undertakes. General liability is standard insurance for all businesses and is likely to be the first policy a freelancer will acquire. Other kinds of insurance freelancers should consider are property insurance, professional liability, and cyber liability.
General liability will defend the freelancer from a party who sues for property damage or bodily injury. If another party sues a freelancer for a perceived fault causing damage or injury, the freelancer’s general liability policy will respond to that claim and protect the business. Additionally, many jobs and projects require the freelancer to have general liability in place.
Property insurance is often bundled with general liability in the same policy, which is called a Businessowners Policy, or BOP. This can include coverage for business personal property and buildings. Additional coverage for property used for the business, such as high-end cameras or specialized computers can be added as needed. Property insurance will protect the business against losses from fire, windstorms, theft, and more.
Professional liability, or errors and omissions insurance, will protect a freelancer from mistakes and accidents caused by the business, whether or not they are at fault. This will keep the freelancer from having to use their own funds in settling a claim for negligent performance of their professional services.
Cyber liability is so important these days! It is almost impossible to own a business and not be connected to the internet. Cyber insurance can include coverage for first and third party losses. It will protect intellectual property and help restore your business from losses involving viruses or hackers. If your business handles client personal information or accepts payments online with credit cards, this coverage is essential.
Making sure you are properly insured will give you peace of mind when accidents do happen. To find out if you have the proper insurance you need or for any insurance inquiries, contact your agent today.
DISCLAIMER: Coverage for the exposures mentioned in this blog post is dependent on the specific policy language of each individual policy and adjuster review determining the cause of loss.