black man with beard sitting on grey couch while researching freelance business insurance.

Freelance and Gig Work – A Business Insurance Guide

Do You Need Freelance Business Insurance?

Do you need freelance insurance? More than likely, yes. Freelancing and gig work have become so popular because they offer flexible ways to make money. You might be pursuing this route as a complete alternative to your 9-5 or as a side hustle to make extra money to pay down debts or save up for a big purchase. No matter the reason, it’s essential to understand the risks associated with choosing this alluring line of work and the kinds of freelance business insurance available that can protect you from the unexpected. 

Understanding the Risk

Once you have found your gig, it is important to think of insurance for self-employed workers. You may not think of your side hustle or gig work as being self-employed, but people who work for themselves need to make sure they are protected against risk. Whether you work as a freelance copywriter, a self-employed graphic designer or run errands for TaskRabbit, it is important to be aware that personal insurance coverage may not always be enough. 

It’s important to remember that you may be labeled as an independent contractor as a freelance or gig worker. As such, you are running your own business, which is why freelance business insurance is so important. Below are a few examples of the most common types of freelancing opportunities with some unsuspecting risks.

Dog Walkers

The shooting and robbery involving Lady Gaga’s dog walker is an extreme example of potential risks associated with this line of work.1 However, what happens if you are walking a dog that gets spooked, darts into the middle of the street, and gets hit by a car? Can you handle the financial burden of being sued by the owners? Or, what if you are walking a dog that bites a child playing nearby? Can you bear the financial responsibility of the medical bills? Dog walking might seem like low-risk gig work but can be the opposite.

Chefs and Line-Cooks

Many gig workers in the hospitality industry are asked to work in kitchens where they are exposed to sharp utensils, hot substances, chemical cleaning supplies, and slippery floors. All of the aforementioned could be liability concerns. What happens if you slip on the wet floor, break a leg, and are unable to work for a period of time?  Can you handle the financial burden of being out of work?

Rideshare Drivers

While companies like Uber and Lyft typically offer their drivers some form of insurance, it typically isn’t end-to-end coverage. The coverage provided by ride-sharing companies is usually divided into periods with varying coverage levels (or none at all) and covers your liability to a third party for bodily injury or property damage.2 This type of coverage would not cover any injury or damage that occurs to you or your vehicle while working. 

Freelance Photographer

As a freelancing photographer, what if you are hired to photograph a wedding, but the client is not happy with the photos you took and decides to sue you for ruining their big day? The right freelance photographer insurance could protect you if a client sues over the quality of your work.

Identifying Your Insurance Needs

You can start identifying your insurance needs by making a list of what you do as a part of your job. Do you take care of animals? Do you drive a company car? Do you operate heavy machinery? This list can help you identify the risk possibilities you may face. 

Freelance Liability Insurance

General liability is one of the most popular types of insurance for self-employed workers. This kind of policy can give you basic protection if you find yourself responsible for injuring or damaging the property of a third-party individual, like a client, customer, or just a person who comes into contact with you or your business. Your general liability policy helps cover things like their medical bills, repair bills, and potential legal fees if you are sued for something they think you’re responsible for. Being sued may seem improbable, but it’s not a risk worth taking. To learn more about preventing one lawsuit from quickly draining you and your business of funds, click here.

Freelance Business Insurance: Commercial Property

Business property insurance, also known as commercial property insurance, can provide payable benefits to help cover loss of income, with the right coverages, or revenue due to property loss. Essentially, if your work building or the equipment inside of it is damaged due to a covered event, commercial property insurance helps protect the income you lose while making repairs or purchasing replacement parts. The funds help your business continue to operate without disruption after a fire, burst pipes, storm, vandalism, or other covered damage.

Commercial property insurance is a key component of comprehensive freelance insurance. We know that your brain and skills are your biggest assets for your business, but your office space, your equipment, your computer, and all of the other furnishings in your work area are also pretty important. If they’re out of commission and you are a freelancer or gig worker, your business might be down for a while. Business property insurance from Woligo could help keep your business afloat.

Professional Liability Insurance for Freelancers

Also known as errors and omissions insurance (E&O), professional liability insurance is one of the most popular kinds of freelance business insurance because it helps protect your business by helping cover defense costs, settlement, and/or judgement if a client sues your business you advised or provided services for. Mistakes happen, and those mistakes by you or your employees can lead to an angry customer who files a lawsuit for a negligent act, error or omission. That’s why, you may hear this insurance referred to as errors and omissions insurance.

You put a lot of work into launching and growing your business, and that’s why it’s important to protect it. Even if you aren’t at fault, that doesn’t always stop an upset customer from filing a claim. Woligo offers professional liability coverage to help provide you with extra protection. It’s an inherent risk of owning a business, particularly if your profession can have a large impact on your customer’s bottom line.

In some professions, professional liability insurance truly is a mustbecause some states require such insurance to operate. Some of the occupations that should consider purchasing professional liability insurance include accountantsbusiness consultantsfinancial plannersinterior designersartistsphotographersgraphic designers, and writers

Freelance Business Insurance: Commercial Auto

Business auto insurance (also known as commercial auto insurance) helps cover physical damage and liability for accidents or fender benders that happen while driving a business-owned vehicle or using a vehicle for business purposes—driving to client meetings, driving to serve a client’s home, driving a rental car while on a business trip.

Business auto insurance is a commonly overlooked type of gig work insurance because many people assume that their personal auto insurance will protect them if they are in an accident. 

Even when you drive as safely as possible, auto accidents can happen. Even if you are not at fault for an accident, the other driver may not have coverage.  In fact, a recent study conducted by Insurify indicated that 12.8% of drivers in the United States do not have auto insurance.3 We don’t have ultimate control over how other people on the road drive, or, for that matter, how well your employees drive.

Also, it is important to know that just because you have auto insurance does not mean you are protected from uninsured drivers.  Many carriers will automatically exclude uninsured motorist coverage unless it is specifically requested.  What is a way to protect your business and its vehicles? Take out a business auto insurance policy.

Disability Insurance for Freelancers

It can be hard to imagine getting an illness or injury that could keep you out of work for a period of time. But, did you know that more than a quarter of people are likely to experience an illness or injury that makes it impossible to work for at least one year before they reach retirement age?4

Unexpected events happen in life. Cancer and mental health issues are two common reasons for disability insurance,5 and both of these conditions, as well as others, could pull you away from work for months or even years. As a self-employed individual, your income depends on your ability to work. If you become disabled, you could lose your income.

Disability insurance benefits for freelancers and gig workers help keep you — and your small business — afloat so you can focus on getting better.

Freelancer Accident Insurance

Freelance and gig workers have a lot of freedom, but they typically miss out on benefits such as PTO and workers’ compensation. Many employees can receive workers’ compensation benefits if they become injured at work. Or, they may be able to use PTO to receive a paycheck even while they are healing and out of the office. Independent workers don’t usually have this luxury, so adding an accident insurance policy to your gig work insurance can be helpful. 

Accident insurance helps provide financial protection for those who may become injured or deceased due to an unexpected accident. The insurance benefits can help cover out-of-pocket medical expenses and other bills that emerge while healing from your injury. It works alongside your primary health plan, making payable benefits directly to your pocket instead of to the medical facilities that are treating you.

It is complementary to disability insurance because you can receive benefits even if your injury doesn’t prohibit you from working. The greatest benefit is that it helps provide a financial cushion that may help give peace of mind. Woligo’s accident insurance is available for self-employed workers at a very competitive price. Many independent workers may expect to pay high teens or low 20s for their premiums.

Where to Buy Coverage

You should buy your freelance business insurance from a reputable source that offers affordable options, convenience, and quality customer service. Lucky for you, you don’t need to look any further than Woligo.  

Woligo is part of the Cameron Group along with INSURICA, First Fidelity Bank and many other companies that provide health, human resource, and financial security solutions to help our customers meet their goals.  With three insurance companies, three insurance brokers and two companies focused on serving small businesses, and with over 60 years of experience navigating setbacks and successes – we understand what it takes to not only survive, but thrive. That’s why we’re here to help our customers do the same thing.

Finding Opportunities

As the interest in freelancing and gig work has grown, so has the number of platforms that advertise this work. These are the top websites to check out if you are on the hunt for your next gig. 

  • Upwork – Upwork is the world’s largest freelance talent marketplace. Upwork’s vision is to connect businesses with great talent faster than ever before.
  • Fiverr – Fiverr’s mission is to change how the world works together. Fiverr connects businesses with freelancers offering digital services in 300+ categories.
  • Guru – Guru is not only a marketplace but a place to do business. You can meet new clients and more often than not establish long-term business relationships, all through Guru.
  • Freelancer – Freelancer provides a place to hire freelancers for any job, online. Millions of people use to turn their ideas into reality. 

Pros and Cons of Freelancing and Gig Work

It’s easy to get excited about the opportunity to make extra money and have a flexible schedule by freelancing, but you also need to remember the risks involved. Dog walking, driving for a rideshare service, and even being a photographer might seem like pretty low-risk jobs, but all of them could quickly end up costing you a fortune.

If you do decide that freelancing and gig work is right for you, explore your options to find the right opportunity for you. But, before you accept a gig, make sure you buy freelance liability insurance, so you are protected from the very beginning!