Independent Contractor Liability Insurance

If you are a freelancer, it is best to consider getting an independent contractor liability insurance policy. In the event of a claim from a customer, you do not have to worry about paying for the claim, which could be a substantial amount of money depending on the amount of the alleged damage.

In addition to a customer claim, there could be legal and court costs to be paid. The insurance company would pay for such expenditure too. Normally, a client would have to provide concrete evidence to make a claim against you. Plus it is nice to have a lawyer on your side that knows what they are talking about. Your insurance company will want to keep the settlement as small as possible, so they will supply you with someone who is skilled.

Therefore, it is best to keep all the vital transaction records with any client for a minimum period of six years. Normally, a client would make a claim within this period for typical contracts. It is not necessary to take liability insurance for all independent contractor jobs, but when you average out the cost for one policy over 365 days the cost becomes easier to swallow.

According to the US law, it is necessary to take this type of insurance for freelancing jobs such as architects, lawyers, surveyors and financial service planners. Occupations like program managers, IT consultants and project managers may be subject to client claims as well. Therefore, it is advisable for those who are working in these fields to consider taking this type of independent contractor liability insurance.

To find out if you need to have the insurance, simply check with the relevant professional or regulating body, which is related to your nature of work. Before purchasing your policy, discuss with the concerned insurance company about your nature of work and the possible liability related to the nature of your work. By doing so, you can figure out the level of cover which might be necessary for your line of work. This sounds kind of like legal speak, because it is.

To summarize, taking independent contractor liability insurance might be a wise move if you are a freelancer. In the event of a customer claim, the insurance company would pay for the claim and legal costs if there are any. Plus the fact that you can go to sleep at night knowing that you are covered in case of any unforseen accidents.

Here is a link to the National Association of the Self Employed