Independent Contractor Insurance – It may not seem obvious, but contractors face more risks than you might realize. One of the most significant risks is the possibility of being sued.
However, without the right insurance coverage to protect you, you could find yourself in serious trouble. That’s where independent contractor insurance comes in.
With a solid insurance quote, disasters, lawsuits, and mistakes that could otherwise bankrupt you will no longer be a major concern for you or your business.
What Is Independent Contractor Insurance?
Independent contractor insurance is a form of general liability insurance designed to protect individuals working as freelancers, plumbers, gig workers, painters, and various other professions.
This policy is particularly beneficial for small businesses that face diverse risks, such as property damage and accidental injuries to third parties.
With this type of general liability insurance, you’re covered for expenses related to reputational harm, advertising injury, and copyright infringement.
How Does It Work?
This insurance type operates similarly to general liability insurance, offering financial protection to freelancers and independent professionals.
First, contractors obtain a policy or quote outlining coverage options, including protection against copyright infringement, accidental damages, legal expenses, and client lawsuits.
Premium payments are made either as a one-time fee or periodically. Should an issue arise within the policy’s coverage parameters, contractors file a claim with their insurer, providing the necessary documentation.
Following an investigation, the insurer determines claim validity and covers expenses, such as legal fees or settlements, up to policy limits. However, policies are often renewable, allowing for continuous coverage.
What Does Independent Contractor Insurance Cover?
Before obtaining a policy, it’s important to understand its coverage. However, it’s worth noting that coverage options can vary between insurers and other factors. Here are some key coverage options:
- Personal injury.
- Bodily injury.
- Property damage.
- Breach of contract.
- Libel and slander.
- Copyright infringement.
- Business interruptions.
- Negligence.
- Lost income.
- Misrepresentation.
- Malpractice.
This insurance type covers some of the following. If more applies, your insurer will make that known to you.
What Does It Not Cover?
While this insurance type covers a variety of incidents, there are certain situations it doesn’t cover. These include:
- Theft of equipment and property.
- Employee illnesses and injuries.
- Company vehicles.
- Damage to property and equipment.
- Professional mistakes.
Additionally, the insurance policy will only cover incidents explicitly outlined in your policy. However, you can obtain different insurance coverage for situations not covered by your independent contractor insurance policy.
Who Needs It?
Independent contractors who need this type of insurance include:
- Freelance photographers.
- Plumbers.
- Carpenters.
- Independent salon professionals.
- Independent business consultants.
- Painters.
- Independent marketing consultants.
- Construction contractors.
- Electricians.
- Freelance editors and writers.
- Carpet cleaners.
- Graphic designers.
How Much Does Independent Contractor Insurance Cost?
The average cost of independent contractor general liability insurance is around $29 per month or $344 per year.
However, this is not a fixed price, and you may not receive a quote for this exact amount from every insurance company or provider.
Various factors influence the cost of an independent contractor’s insurance policy. Here are the key factors responsible for determining the cost:
- Deductible amount.
- How long you have been in the business.
- Business risks.
- Location.
- Insurance coverage amount.
- Previous claims.
And the number of employees you have. The higher your number of employees, the higher your payroll expenses are.
How To Get Independent Contractor Insurance
Obtaining independent contractor insurance is straightforward with the right steps. To assist you in completing a successful application process for a quote, we’ll provide the necessary procedures. Follow the prompts below to get started:
- Decide on the amount you need.
- Consider the risks involved.
- Find out if you can include it as an endorsement in your homeowner’s quote.
- Determine how you want to shop.
- Compare insurance companies.
- Purchase your policies.
Once you buy a policy or quote from an insurance company, you will start paying premiums to the insurer to keep your policy active and ready to use when necessary.
Best Independent Contractor Insurance Companies
As a freelancer or independent contractor, it’s important to consider obtaining this type of insurance.
Fortunately, there are numerous reliable sources from which you can shop for this type of insurance policy. Here are some of the top independent contractor insurance companies:
- Nationwide.
- The Hartford.
- NEXT Insurance.
- Hiscox.
- biBERK.
- Thimble.
- Farmers.
- Chubb.
- Insureon.
- Huckleberry.
- Allstate.
- Westfield.
- USAA.
- Clear Blue Insurance.
- Allianz.
- Travelers.
- CNA.
- Acuity.
- Cincinnati Insurance.
- Frankenmuth Insurance.
- State Farm.
No matter the size of your business, you can find a good insurance policy at any of these companies.
