Insurance for Freelancers: What You Need to Know
In recent years, side hustles and the gig economy have become increasingly more popular as people move towards a better work-life balanced lifestyle. While flexibility in the workplace has been a long sought-after goal for many, it’s not always as glorious as it seems. In order to be a professional freelancer in any field, you need to put in serious work – often outside the typical working hours.
Being a full-time freelancer means you are independently employed and cannot benefit from the perks of working for a larger, more established company – such as tax benefits, social security and insurance. Working as your own boss also means you are the only person that can be held responsible for a problem if the work that you have completed causes any form of loss or damage to a client.
For this reason, like any other business owner, freelancers need to protect themselves with the right professional liability insurance program. Now, before making the leap and venturing out on your own, it’s important to learn about how to protect yourself, your business and any assets you hold.
Why do freelancers need insurance?
Working as a full-time freelancer comes with many benefits – being your own boss, making your own hours, setting your own rate etc. However, it also comes with the drawback of not being covered by an overarching insurance policy many permanent employers offer – which often covers more than you realize.
Whether you’re in insurance, consulting, graphic design or freelancing for another type of industry, there’s always going to be risk involved. Professional liability insurance provides critical protection from losses and lawsuits that your personal insurance does not cover.
Businesses and freelancers alike can experience claims if their customers believe they have lost any money as a direct result of the work that a freelancer provided or if clients are under the impression the contractual obligations have not been met.
In addition, as a freelancer, you may encounter some difficulty finding work without insurance due to the fact that potential clients could require proof of coverage before signing a contract or agreeing to hire you. The freelancing field is becoming very competitive as more people branch out on their own or attempt to earn extra income through a side hustle. Not having the correct coverage could possibly disqualify you from being considered by some clients.
Having a quality professional liability insurance program as a freelancer makes you more attractive to potential clients while also letting them know you are prepared to look out for both your and their best interests.
Professional liability insurance policies not only increase your odds of making money as a freelancer, but they also decrease the chances that you’ll lose money. Although larger corporations may have enough money to recover from an expensive liability or malpractice claim, the majority of freelancers don’t have the resources to defend themselves in these situations and could be left financially crippled without insurance coverage.
The experts at Oegema Nicholson provide high-quality insurance products in Ottawa that can help protect the integrity of your work while ensuring you don’t pay out of pocket. Finding the right professional liability insurance allows you to focus on growing your network and completing additional freelance work without worrying about potential risks.
What is Professional Liability Insurance?
Some freelancers begin working under the assumption that their personal insurance policies will protect their business, in addition to themselves. However, that’s not always the case. Others go into freelancing without considering the need for insurance coverage at all.
While a personal insurance policy may provide limited coverage for certain situations, such as property loss, it won’t necessarily protect you from business-related liability claims.
Professional liability insurance is the most relevant – and arguably important – insurance policy a freelancer should consider having. Also known as errors and omissions coverage, this type of policy can help any participant in the gig economy, who works as a freelancer, protect themselves from unforeseen liability issues.
Professional liability insurance provides coverage for freelancers who are accused of making mistakes that affect the bottom line of their client’s business. These types of claims can include situations where you are accused of incorrectly providing a contracted service or that the work you submitted was faulty in some way.
At Oegema Nicholson we provide you with a team of knowledgeable insurance experts to deliver the coverage you need. Our professional liability insurance services in Ottawa come at an affordable price that freelancers can easily incorporate into their business expenses.
Professional Liability Insurance Protects Against Lawsuits
Although freelancers should be concerned about typical liability risks like lost, damaged or stolen business property – you also need to be protected against potential lawsuits. If an incident occurs where you make a mistake or oversight, don’t follow through on a contract, or perform a negligent act that results in financial or physical harm to a client, you could have a lawsuit brought against you.
Due to the nature of this business, the majority of freelancers don’t have the financial resources to fight a long and costly lawsuit – even if it results in no wrongdoing. In addition to other things, professional liability insurance can cover the costs if you’re sued by a client.
At Oegema Nicholas, our professional liability insurance can give you peace of mind knowing your legal expenses may be covered, should a client challenge the quality of your work. Our high-quality policies ensure you don’t end up paying out of pocket.
Who needs Professional Liability Insurance?
Professional liability insurance is an essential investment for any freelancer who works directly with customers to provide a specific or specialized service. Regardless of the service you fulfill, a professional liability insurance policy ensures all the bases are covered in case a client decides to hold you responsible for any errors in your work.
This type of coverage is typically recommended to businesses that provide some kind of professional service or advice, such as:
- Management consultants
- IT consultants
- Accounting practices
- Graphic design firms
- Investment advisers
Professional Liability Insurance With Oegema Nicholson
Freelancing can be a lucrative yet unpredictable business to be a part of. Having professional liability insurance protects you against claims that a professional service you provided caused your client to suffer harm. The team at Oegema Nicholson can connect you to some of the best insurance rates on the market – allowing you to focus on developing your network and increasing your work.
For more information on professional liability insurance in Ottawa, call us at 613-704-7766.