Business insurance for sole traders

The level of cover required and what kind of insurance a sole trader needs should be highly tailored to the business. As a sole trader, finding the right liability cover, such as public liability and professional indemnity insurance, should be high on your list of priorities.

While you should be confident in the quality of the service you provide, things don’t always go exactly to plan. If your business is likely to incur significant costs defending a claim, sole-trader insurance could prove essential.

Our insurance for sole traders is designed to protect you from the potential risks associated with being a one-man-band. For professionals working for themselves, we also offer specialised self-employed insurance policies, including tailored public liability cover.

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What insurance does a sole trader need?

The insurance requirements of a sole trader will depend on the industry you work in, the type of work you do, and where you work from. When deciding what level of cover you need, think how you would cope financially should you be unable to work or face a legal battle.

If you’d like more information on what to take into consideration when choosing insurance, refer to our FAQ Guide on the types of insurance most appropriate for sole traders.

The following introduction to the most important sole trader insurance covers should give you an idea of the appropriate package for you.

Public liability insurance for freelancers

If you’re a sole-trader, public liability insurance can protect your business against the cost of settling or defending a claim for bodily injury or property damage from a client or member of the public. For example, if you have members of the public on your premises, it is important to ensure you have protection in place should they trip over a piece of your equipment and injure themselves. This can also apply if you visit them on their premises and, as an example, accidentally damage their property.

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Professional indemnity insurance for sole traders

Alongside other liability covers, professional indemnity insurance is worth considering if you offer professional advice or consultancy, provide an expert service, or handle client data. Sole trader indemnity insurance provides cover for the cost of correcting mistakes, settling a claim, and legal fees for defence if a client accuses you of making a professional mistake.

Other sole trader insurance covers

Office contents insurance for sole traders may also benefit your business. Whether you work from home, an office or another form of workspace, office insurance is important for protecting you against damage to your business premises, the contents within it, and for any loss of income caused by business interruption as a result of this damage.

Other types of cover you may want to consider are cyber and data risk insurance and personal accident insurance.

If you use a computer or the internet for any part of your work, you could be at risk of cybercrime. Cyber and data risk insurance protects from a data breach or hacking of computer systems and can support you by covering the costs of a ransom payment, data recovery, loss of business and more.  

While personal accident insurance protects you financially in these circumstances by providing a weekly pay-out to make up for loss of income and the cost of support staff or retraining staff.

As well as the above mentioned, there are various additional forms of cover that you may want to consider if you are a sole trader.

What is your profession?

Find out more about the range of insurance covers we offer to specific industries and professions in the list below:

Self-Employed Guides, Articles & Answers