Insurance for Freelancers and Contractors
Freelancers carry risks that employment previously absorbed, and the relevant cover depends on the nature of the work rather than the size of the business.
Professional indemnity
Covers claims that your work or advice was negligent, inadequate or caused a loss. Essential for anyone providing expertise: consultants, designers, developers, writers, accountants, marketers.
Frequently required contractually by clients, and larger organisations often specify minimum limits.
Written on a claims made basis, meaning it covers claims notified during the policy period. That has an important consequence: cover must be maintained after the work is done, and after you stop trading, through run-off cover. Ceasing cover the day you retire leaves past work unprotected.
Public liability
Covers injury or property damage to third parties. Relevant for anyone visiting client premises or having clients visit them, and for anyone working physically.
Frequently required for site access, and some clients will not admit contractors without evidence of it.
Equipment and business property
Home insurance generally excludes business equipment, or limits it severely. A freelancer with a laptop, camera equipment, tools or a specialist workstation is frequently uninsured under a domestic policy.
Portable equipment cover extends protection away from the premises, which matters for anyone working on location.
Income protection
Freelancers have no sick pay. An illness lasting months stops income entirely, and this is the risk most likely to cause serious financial harm.
It is also the cover freelancers are least likely to hold, partly because the premium is a visible cost against uncertain income.
Cyber and data
Anyone holding client data has exposure. Breach notification obligations apply regardless of business size, and the costs of investigation and notification fall on the business.
Increasingly specified in client contracts, particularly with larger organisations.
Practical points
Read client contracts before agreeing them. Required insurances, limits and indemnity clauses are frequently specified, and agreeing to an indemnity broader than your cover leaves a gap you personally carry.
Describe your activities accurately. Cover responds to what you told the insurer you do, and drifting into adjacent work without updating the policy creates exposure.
Consider packaged freelancer policies, which bundle the common covers at lower cost than arranging each separately.
Review annually as the work changes, since the profile of a freelance business two years in rarely matches the one described at the start.
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