What sort of insurance do I need as a freelancer?
As a freelancer, it can be difficult to know exactly what type of insurance cover you need and why. That’s why we’ve created this guide to help you discover which types of insurance are necessary for freelancers and what types of cover you may wish to consider taking out.
Professional Indemnity Insurance
Professional Indemnity Insurance (also known as Professional Liability cover) is a must for most freelancers. No matter what your line of work, this insurance can cover claims made by clients for personal negligence or mistakes made in the work or services you provide for them.
For instance, if you’ve been contracted to create some copy for a client’s website and the client then accuses you of providing incorrect, misleading or plagiarised content, this type of cover should be able to help you with any claims made against you.
Public Liability Insurance
This type of insurance covers costs related to any legal claims a member of the public makes against you as a freelance worker. ‘Member of the public’ here includes all people who are not involved in your business, such as clients, other people you work with and any other member of society.
An example of a scenario where public liability insurance would be useful for a freelancer is when a client makes a claim against you because they fell and sustained an injury on the slippery floor in your office. In this instance, public liability insurance can cover any legal costs and compensation you may face as a result of the incident.
Income Protection Insurance
Unlike permanent employees, self-employed freelancers are not entitled to sick pay, holiday pay or maternity pay, meaning that if you do fall ill or are unable to work for any reason, you will not receive any kind of benefit from an employer. This can be extremely problematic for many freelancers, particularly those who become unable to work very suddenly or unexpectedly.
For instance, if you’re in an accident and sustain an injury that results in an inability to work, you will be left with no income, which could affect both you and those who depend on you (your children, spouse, etc). This however can be avoided if you have Income Protection Insurance, as it will allow you to continue to receive a cut of your income while you’re off work due to the injury.
Office Insurance and/or Home Insurance
Whether you work from home or from another location such as an office, it’s a good idea to make sure that your work environment is fully insured in case of theft or damage to equipment. Office and Home Insurance are particularly important for freelancers who have a lot of equipment, as if something gets broken, stolen or damaged, this can often have a huge impact on your ability to provide your service to clients.
One example of a context in which these types of insurance plans would be useful is in the case of a freelance photographer who has a studio in their home. Making sure that they have adequate cover will ensure that you won’t have to worry about replacing equipment in the event that it is stolen or damaged, meaning that you’ll be able to get back to work as soon as possible.
Business Car Insurance
Business Car Insurance is necessary for freelancers who use their car for work-related purposes (other than for commuting). These could be going for meetings with clients, travelling to clients’ sites to carry out work or picking up supplies. If you are involved in an accident in one of these scenarios and you haven’t declared your vehicle for business use with your insurer, then your insurance policy could be invalidated and any claim you make may be rejected. Therefore, making sure you have the appropriate Business cover for any vehicle you use for work-related travel is key to keeping you out of hot water.
We hope this article has given you a good overview of some of the main types of insurance you need as a freelancer. Other types of insurance may also be useful, such as business interruption cover, media insurance cover and disability, health and life insurance which can all come in handy for freelancers and therefore may also be worth looking into.
Whichever type of insurance you decide to get as a freelancer, we always recommend seeking advice from a professional, as they will be able to provide you with a tailored insurance plan that suits your needs.