Article | 06 Feb 2018

Freelance insurance? What you need to know

Posted in Freelancer, Top tips, Tools & Advice, Learning,

Whether you’re a new freelancer getting set up, or an old-hand looking for more security, organising the right freelance insurance is an important investment. There are various options out there, to protect both your business, yourself, and those most important to you.

So, to help you make an informed choice about which policies you need, we’ve taken a look at the different options available and most important issues to consider before you purchase.

Professional Liability Insurance

Professional Liability Insurance (PI), often called errors and omissions (E&O) or indemnity insurance, is extremely important for freelancers since it offers protection in the event that a client makes a claim against you for a mistake in the work you have undertaken - regardless of whether or not you’re actually at fault. It provides valuable peace of mind and reassurance in the cut and thrust of today’s fast paced world where jobs are briefed and commissioned in an instant. Try Jack, a specialist provider for freelancers, which offers PI that takes into account your specific needs. You may also want to consider cyber insurance, as part of your PI policy, particularly if you handle a lot of client data, as you’ll be covered for a range of costs that could result from a cyber-attack or data breach. For this, Superscript is a good first port of call.

Public Liability Insurance

If you come into regular contact with clients and their equipment either in your workspace or theirs, or you attend trade fairs and conferences, public liability insurance (PL) will provide you with the peace of mind to allow you to expand your public profile without the risk of a legal claim should anything go wrong. PL covers bodily injury for clients who visit you on your premises; if you work on your client’s premises, then it will cover you in the event you accidentally damage some of their property; and you’re also covered when using a client’s equipment at trade fair or conference event.

Employers’ Liability Insurance

Employers’ liability insurance is a legal requirement for all employers – including those who work with contractors, freelancers or interns - and the government penalties for not having it are severe. So, if you contract out to other freelancers, you may need employers’ liability insurance, especially if they work on your premises under your control and supervision. If, however, you never see the freelancers who you contract out to then you probably don’t need this insurance, as you’re not in control of their work environment. If you’re not sure, consult the Health & Safety Executive for more details.

Health Insurance

Of course, living in the UK, we have access to the world class NHS, providing free medical care when we need it. But have you ever thought about waiting times and all those visits to the GP before you are referred to a specialist? As a freelancer, although you may be very keen to use the NHS, inevitably longer waiting and referral times means less efficiency and productivity for your business. You might decide that paying into a private medical insurance policy makes financial sense since when medical issues do crop up you will be seen swiftly, minimising the impact on your professional life and reducing the loss of income incurred.

Home Office and Equipment Insurance

As a freelancer, your computer, camera, printer and other electronic equipment are the bedrock of your business and livelihood, so it’s important that this is insured against theft and accidental damage. Look for ‘new for old’ cover so that you get a replacement of the highest quality for your possessions and also make sure you add on cover for repair or replacement of your computer if it is damaged by a virus. Also, don’t forget to tell your insurer if you work in a coworking hub as this will have to be factored in to the policy. One good option is Dinghy which covers coworking hubs as standard, as well as PI and cyber coverage!

Income Protection

As any freelancer knows too well, duvet days are not a day spent in front of daytime television nursing a migraine or cold, but rather a day spent at the coalface in your duvet in spite of the fourth bout of flu this winter! Whilst this might be doable in the case of a bad cold or flu, there are times when serious sickness or injury really does prevent work, perhaps for weeks or months at a time. For such cases you can take out income protection insurance, which will allow you to recuperate so that you’re able to return to work when you’re ready, but safe in the knowledge that you can still pay the bills. Try Drewberry Insurance, which offers an income protection policy designed specifically for the self-employed.

Life Insurance

If you have dependents who rely on your income to pay the mortgage, school fees or day-to-day living costs, you would be well served by taking out life insurance. In many jobs employees have a death in service benefit, which will continue to pay their surviving dependents a portion of the salary due up until retirement. As a freelancer, a life insurance policy would offer an equivalent level of protection and will pay your loved ones a lump sum or regular instalments in the event of death to alleviate unnecessary stress at a challenging time.

Freelancing may not have the inbuilt security of a full-time job, but organising the right insurance can give you that same peace of mind, without sacrificing your much-loved freedom and flexibility. Then if disaster does strike, you know there’s a safety net to catch you.

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