26 Mar Navigating the World of Professional Indemnity Insurance for Freelancers

At first glance, freelancing seems headache-free. You take on any new clients that you can handle, while maintaining your own flexible schedule.

However, freelance life isn’t without its challenges, one of which can be helped by having a solid professional indemnity insurance policy. What do these policies cover? How can you purchase one? Here’s what you need to know.

What is Professional Indemnity Insurance?

Also known as professional liability insurance, indemnity insurance kicks in when something goes wrong with the work that you did for your client. If the work can’t be redone in any way, your client can sue you, and without a liability policy, you could end up paying quite a bit of money out of pocket.

For example, if you’re a photographer and are hired to shoot a wedding, but something goes wrong with your camera’s memory card afterwards and none of the photos are saved, the distraught couple could sue you. If you have a professional liability insurance policy, your insurance may pay out the amount of the damages, allowing you to keep running things – business as usual.

What Else Will This Type of Insurance Cover?

On top of helping in the situation described above, a professional liability insurance policy usually also covers:

• Late Assignments – If you have a tight deadline to meet and aren’t sure that you’re going to make it, your client may get upset. After all, they need that project, tax return, or whatever else the project consists of on time. Thankfully, professional indemnity insurance covers these late assignments, as long as the issue is due to circumstances outside of your control, like a broken computer or lack of power due to a storm.
• Negligence – Sometimes freelancers don’t make simple errors or mistakes. Sometimes they’re negligent when getting work done for their clients. For example, if you knowingly drank alcohol and then went to install a television on a wall, which promptly became unanchored, then you were negligent in your work.
• Errors and Mistakes – The example of the wedding photographer who messed up their client’s photos definitely fits into this category. However, there are many others that do as well. An incorrect tax return filled with errors, a quick handyman job gone wrong, or even a ghost-written book that includes incorrect information that wasn’t caught while fact checking can all result in lawsuits or fall into the category of a professional indemnity policy claim.

Do You Need a Professional Indemnity Policy?

Are you a freelancer in need of some protections? Do you want to get a professional indemnity or liability policy, but aren’t sure where to begin? If you answered yes to either of those questions or need additional information about insurance for freelancers, then contact Spivey Insurance. Our knowledgeable agents will help you select the policy you need to protect yourself and your business.