Do Freelancers Need Business Insurance?

Do Freelancers Need Business Insurance?

When you work for someone else’s business or for a corporation, you don’t have to worry about liability as that company is responsible for protecting themselves plus you!

As a freelancer, it’s a different story, since you’re the one who is in charge of and completing the work. If you’re working with bigger corporations or companies, they might even require a certain business insurance to ensure they’re legally protected.

So, why do freelancers actually need insurance?

Business insurance policies give you a lot of protection against things you might not think about

It’s not easy to think about all of the things you have to manage as a freelancer and lawsuits or losses should be the least of your worries. No matter what industry your business is in, business insurance can provide you with protection against different situations you might not think about until you’re in that exact moment. 

Personal insurance policies typically don’t cover your business claims

If you’re working out of your home as a freelancer, your personal insurance policy might not cover your business insurance claims.

For example, if a client comes and visits you at your home and gets injured, your homeowners insurance company might deny the insurance claim as if it was a business meeting, meaning you’re responsible on your own for paying medical bills.

Business insurance can help protect you against lawsuits

When you’re providing services to a client and you don’t follow through on your contract, or make a mistake/oversight, it can lead you down the path of a potential lawsuit. 

As owning a small business is expensive, most freelancers don’t have the financial resources to hire an attorney and fight their case in court, even if you weren’t at fault. Typically, your Errors & Omissions insurance will help cover your legal costs if you ever are served with a lawsuit/taken to court.

Which insurance policies should freelancers consider?

While there are tons of different policies built for different industries, risk levels, etc, you’ll find a couple of the most common freelance business insurance policies below

General Liability Insurance

General Liability Insurance is typically seen as the most broad coverage available to business owners. This type of business insurance can help protect your business from being sued for bodily injuries and property damage, along with other types of “injuries” including copyright infringement, libel, and slander. 

Errors & Omisssions (E&O) Insurance

Typically Errors & Omissions (E&O) insurance will cover the legal costs of a client suffering financial loss due to negligence or your mistake. While there are policy limits, Errors & Omissions insurance will pay for your legal fees if a client ends up suing you, no matter if you’re at fault or not.

Commercial Property Insurance

While most freelancers think that Commercial Property Insurance covers commercial buildings, it also helps you protect your business property that becomes damaged due to a fire, burglary, or unexpected event.

Cyber Liability Insurance

If you’re a freelancer in the tech space, you might need cyber liability insurance that protects you from incidents that occur online. Usually your Cyber Liability policy is bundled with your Errors & Omissions (E&O) insurance policy.

Do you already have a freelance business that needs protected or are you considering starting one and want to ensure you’re covered? We love helping freelancers find the best business insurance coverage for their business and would love to help walk you through the small business insurance process.

Learning what's important to you and giving you the best insurance protection at an affordable price is our goal. As an independent agency, we can provide you with a growing number of flexible insurance options from dozens of national brands. At MetroOKC Insurance, we want you to understand the insurance policy you are buying and how it works. We believe peace of mind comes from making informed choices.