What insurance do I need as a freelancer?
Becoming your own boss brings freedom – but navigating freelancer business insurance is often new territory. Professional indemnity insurance is considered the most important type of cover for freelancers, protecting you if unhappy clients take legal action. This is a risk for business consultants, therapists and freelance creatives alike.
You might need other types of business insurance covers depending on the nature of your freelance work. If it’s people-focused, public liability insurance safeguards you against third party property damage or bodily injury claims, while portable equipment insurance covers your all-important equipment. Working out which insurance you need as a freelancer is all about assessing your unique situation – so your business can flourish.
Why do I need freelancer insurance?
Whether you’re a freelance management consultant, tutor or architect, working for yourself brings risk with the reward. A valuable file could go missing, or you might miscalculate measurements for a project. Accidents happen – but as a freelancer, if something goes wrong at your hands, you could face a compensation claim from a client.
Professional indemnity (PI) insurance can protect you from the cost of a client saying there are faults in your work. PI insurance covers both compensation and legal expenses. You might also consider taking out public liability insurance to protect against claims that you’ve damaged someone else’s property, or caused an injury to a third party. Cyber and data security exists to protect you if the security of your data, or your client’s data, is compromised. If interruption costs arise from personal injury or equipment damage, freelance insurance is there to help.
What type of freelancer insurance do I need?
Unlike employees, freelancers take sole responsibility for their work, so insurance is essential for anyone working solo – even if you only freelance alongside another role. There are several types of freelance insurance which can help future-proof your move towards independence.
Professional indemnity insurance
Professional indemnity insurance can be a lifeline for freelancers if a client believes something has gone wrong. Perhaps you’re a freelance beauty therapist and someone says you didn’t deliver what they asked for. A graphic designer can also experience clients saying something they've carefully produced is off-brief. Or, maybe you’re a freelance advertising professional and a client claims sensitive information has been published, leading to a contractual dispute. If you’re a freelance management consultant who deals in advice, a customer might believe your insights harmed their business. Freelance professional indemnity insurance covers the cost of settling claims – so your great work faces minimal disruption.
Learn more about professional indemnity insurance.
Public liability insurance
Public and products liability insurance is important for freelancers who deal with people. It offers protection if someone claims they were injured or faced property damage because of your work or products. Maybe you’re a freelance photographer and trailing cables injure a wedding guest. If you’re a yoga teacher, someone could claim your training caused them injury. Public liability insurance pays related legal fees or compensation on your behalf, so it’s crucial cover if you couldn’t otherwise afford to do so.
Not sure what you need? Read our guide to insuring your home business against liabilities.
Contents insurance protects your assets while working from home. Contents insurance is an important consideration for freelancers, since your personal home insurance policy may not cover business equipment such as computers. This cover benefits sole traders who rely on tools, valuable hairdressing equipment or protective gear as well as freelance tutors who keep instruments, books or software. Contents insurance protects against risks from fire, theft and accidental damage.
Learn more about contents insurance.
What other types of cover do I need as a freelancer?
Business interruption insurance
Crisis scenarios might be few and far between, but when they happen, the implications can be serious for freelancers. For example, flooding could cause damage to your essential home business premises. You can count on business interruption insurance to support you with any resulting income loss from property damage.
Personal accident insurance
As a freelancer, there’s a lot resting on your shoulders – and if you happen to injure yourself, there’s no sick pay. That’s why personal accident insurance is so useful for freelancers. If you’ve been out of action for 14 days this cover provides weekly payments until you can return to work.
Portable equipment insurance
Lots of freelancers rely on equipment to do their best work, so portable equipment insurance can prove invaluable. Even something as simple as a mobile phone may prop up your freelance business by ensuring you can join conference calls or book the next job. This cover prevents you from being hit with the cost of replacing the equipment that helps you to get the job done.
Cyber and data risk insurance
Cyber insurance is important for freelancers, since anyone can fall victim to cyber crime. If you handle any personal data, the risk is heightened, but anyone who uses the internet for work is at risk. Cyber and data insurance covers the cost of recovering lost data, lost income and GDPR claims.
Product liability insurance
Product liability insurance provides an extra layer of cover as part of public liability insurance, protecting you if someone claims they were injured, or their property damaged, because of a product you designed, produced or sold. Product liability cover is important for freelancers who create or supply products – even if those products are entirely digital.
Legal protection insurance
The self-employed lifestyle comes with a responsibility to deal with any misunderstandings, which might be entirely new to you. If a client refuses to pay for the work you’ve done, or you need to take trespassers to court, legal protection insurance can support you with the costs.
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Related guides & FAQs
What is public liability insurance?
Not sure if your freelance business needs public liability insurance? Read our public liability guide to learn why this cover can be crucial for self-employed people.
What insurance does a sole trader need?
You might be wondering which types of cover a sole trader needs alongside public liability insurance so you can calculate how much it’s likely to cost. Read our sole trader guide for insights.
What should freelancers know about cyber security?
Read the Small Business Guide to Cyber Attacks to discover more about the risks freelancers could face from cyber-attacks.