10 Jun

What insurance do freelancers need?

What insurance do freelancers need?

Being self-employed comes with a lot of benefits. You have a certain level of freedom in terms of what jobs you take on, where you work and how many hours per day you work for.

The downside to all this freedom though is the increased responsibility you have. If something goes wrong, then it is up to you to sort it out – and without a safety net in place that can prove to be expensive and time consuming.

Whatever sector you work in it is important to make sure you are protected against any and all eventualities – which is where insurance can help.

Our insurance partners Create Insurance have provided the below guide to all the different forms of insurance available to freelancers and self-employed workers.

Different types of insurance policies available to freelancers

There are a lot of different insurance policies that can provide peace of mind to freelancers. Some will be more relevant than others, depending on the sector you work in and the type of work you do.

The most common insurance policies freelancers choose include:

  • Public Liability insurance
  • Professional Indemnity insurance
  • Equipment cover
  • Income Protection insurance

Public Liability insurance

If you regularly meet or visit clients in person, or you do a lot of work that puts you in contact with the general public, then Public Liability insurance should be a consideration.

This type of insurance offers cover if you cause a personal injury or damage third party property during the course of your work. 

Public Liability insurance provides cover for any legal costs incurred if someone claims against you, as well as certain compensatory payments you may be required to make. Before you take out Public Liability insurance, you need to consider whether it is relevant to you and your freelance business. For example, if you always work from home and rarely visit or meet clients then you may not need it. However, if it is relevant to you then the level of protection and peace of mind it offers could be invaluable.

Here are a handful of scenarios where a public liability policy could help a self-employed worker:

  • Slips, trips and falls in your place of work causing injury to a third party visitor
  • Dropping equipment on a client’s expensive flooring causing damage
  • Your equipment causing damage to the electrics at a client site
  • Spilling your drink on a venue’s sound system causing extensive damage
  • Your equipment set-up falling down and causing injury to a passer-by

Professional Indemnity insurance

Sometimes referred to as ‘professional liability insurance’ or just ‘PI insurance’, Professional Indemnity insurance offers cover for any legal costs and expenses related to a client taking legal action against you.

It may be rare and you may feel that it will never happen to you, but all it takes is for a client to allege that the advice or service you provided was inadequate and caused them a financial loss and you could be facing a lengthy, time consuming and expensive legal battle.

Professional Indemnity insurance provides peace of mind that your freelance business is protected against potentially ruinous legal costs and compensation pay-outs.

Here’s some examples of when a professional indemnity insurance policy would be required:

Professional negligence - This could be making a mistake when carrying out work for a client. For instance, if you work in web development and make a website for a client that is found to have security flaws then you could face a claim if your client suffers a data breach.

Causing loss of income - If someone experiences a financial loss, personal injury or property damage due to your advice, error or negligence.

Breach of confidential information - If you share sensitive information about a person or business without their consent.

Defamation - Professional indemnity insurance can provide cover if a claim is made against you by someone who feels you have said (“slander”) or written (“libel”) something defamatory about them that is false.

Breach of copyright or confidentiality - The accidental use of someone else's intellectual property can lead to expensive claims being brought against you. If you are a graphic designer who uses a picture without the permission of the photographer, for example, then you could be sued for breach of copyright.

Equipment cover

Many freelancers and self-employed workers have a lot of specialist and expensive equipment they need to do their job. If something should happen to your kit then you could be in a position where you are unable to work – which could be a huge problem if you cannot afford to immediately buy a replacement.

Whether it’s a laptop, PC or tablet you use for business, your cameras and specialist photography equipment or anything else you need to do your job – it can be worth buying insurance cover to protect against risks such as accidental damage and theft.

Income Protection insurance

Self-employed workers are exposed to the risk of lost earnings as soon as they are unable to work due to illness or injury.

Unlike employees, freelancers do not have the benefit of receiving Sick Pay and Holiday Pay from their employers, so have to absorb these costs themselves – potentially resulting in financial difficulties if they are unable to work and earn for a long period due to medical problems.

Income Protection insurance can act as a safety net for freelancers, paying a monthly income (after an initial waiting period) to cover the loss of earnings caused by a long period of illness or injury.

Special insurance offer for Mazuma customers

Buy any annual insurance policy from Create Insurance, or their parent company BHIB Insurance Brokers Ltd, and receive a £20 Amazon voucher after three months of your policy being live.

To find out more and get your free quote, visit: https://www.createinsurance.co.uk/mazuma-money/ 

Get a quote now
Start Your 2 Month Free Trial, get a quote!

Take 30 seconds to get a quote and see how we can help you.

Get a Quote