Why do life coaches need insurance?
Unsuccessful techniques
Whether you carry out cognitive behavioural therapy (CBT) or advise clients on visualising their career goals, your chosen techniques have an impact. During a session with a weekly client, you begin working on a strategy to help them overcome some of the obstacles holding them back. Further down the line, the client claims your technique caused them mental injury and trauma and files a claim for malpractice. When professional treatment liability is built into your life coach cover, this can assist with legal and compensation costs.
Unhappy client
Your client makes a decision which results in the loss of their job. This situation leads to financial losses and reputational damage which makes it difficult to find employment. Unfortunately, they say your advice was the reason for their actions and begin legal proceedings against your small business, citing professional negligence. Your career is based on giving advice, so tailoring insurance to mitigate such risks can help to defend or settle claims against your life coaching business.
Data breaches
The database you use to store client information is full of sensitive data. Despite employing the recommended security measures and following safe storage guidelines, your system is compromised by a cyber-attack. The cybercriminals hold your data to ransom and threaten to expose details unless you pay to retrieve it. Thankfully, insurance can assist your small life coaching business with the breach – Hiscox can cover costs and provide expert advice, helping you to recover quickly.
What insurance is available for life coaching?
Professional treatment liability insurance
Should a client claim the techniques used in your therapy led to illness or injury, professional treatment liability insurance can help to protect your life coaching business. You’re committed to providing the best guidance possible, but you’re unable to control how your words are interpreted and can’t always predict the effects. While you’re always committed to helping rather than hindering, the success on your work is based on how it’s received, so if you or an employee get it wrong, Hiscox can assist with costs associated to a claim.
Public liability insurance
As a life coach, working with people is an everyday occurrence and risk comes with that, whether you hold sessions with clients at your office or at their residence. Incidents can occur which are unrelated to the work you do. You might accidentally break a valuable ornament in their home, or they could trip on uneven flooring in your office foyer, for instance. Public liability insurance helps to cover the legal and compensation costs of a claim should someone become injured or face property damage because of your life coaching business.
Professional indemnity insurance
Giving professional advice is part of being a life coach – your recommendations may be based on expert opinion and are designed to enhance your clients’ personal and professional lives. You always work hard to achieve the best results for your clients, but if someone says your advice was poor and caused negative consequences, such as financial losses, they might take legal action. Professional indemnity cover can bolster your business by assisting with legal expenses should you need to defend yourself or pay any potential compensation orders.
Life coaching professionals might also benefit from a combination of other insurance products including employers’ liability, personal accident cover, office insurance and cyber and data cover.
If you’re not sure what you need, tell us a little more about your life coaching business. We’ll help you to build your quote and explore any other insurance needs.
Build my coverInsurance for life coaches: FAQs
What insurance do I need if I’m working from home?
If you’re working from home, you may still require cover for your home-based business, especially if your home insurance policy doesn’t cover your valuable work equipment.
Whether you work from home or an office, your role will also consistently require you to give advice, so both professional indemnity and professional treatment liability cover may always be relevant. Accidents are possible anywhere, too, so public liability insurance could provide a vital safety net in the event of trips, slips, falls or damage to property for when clients visit you.
When would a life coach need employers’ liability insurance?
Employers’ liability insurance might be a legal requirement (external link) for your business from the moment you take on your first recruit. For most businesses with employees in the UK this is essential, although whether you need employers’ liability cover differs depending on the business and the circumstances.
This product helps to safeguard your company if a member of staff claims they have fallen ill or become injured as a result of their work for you. Small ventures that would be unable to manage financially without cover in the event of a claim could find this insurance especially beneficial.
Do Hiscox need to know how many clients I coach and how often?
No, it’s not necessary to provide any details of your client base before you get cover – we understand that all small businesses have to start from somewhere.
Should your potential liabilities change, however, it might be a good idea to add to your policy accordingly. For instance, you might need to take on staff as client numbers grow and require employers’ liability cover. Also, if your turnover increases it may be a prompt to check your levels of cover as they may need increasing to align with the expansion of your business.
Related articles and guides
Starting a tutoring business
Are you thinking of setting up your own life coaching business? Pick up some tips from our guide to starting a tutoring business to get a head start and understand the similarities.
Real examples of indemnity protection
As a life coach, your role involves giving advice to clients. Discover how Hiscox helped a customer with a claim around the financial consequences of their advice.
Employers’ liability and public liability – the differences
Understanding insurance types for your life coaching company can be important – this guide explains the differences between employers’ and public liability.