Becoming your own boss comes with lots of perks, but to ensure the long-term success of your business, you need to attend to responsibilities as well. One of your top priorities should be self-employed business insurance. It will protect your business from unexpected financial disasters, should they ever come. 

We understand insurance options can confuse anyone, so that is why we put together a guide on what you need to know about insurance coverage for all you freelancers, 1099ers, side hustlers, solopreneurs, and small business owners.

Most Common Types of Business Insurance

Below is a list of common insurance coverages that self-employed workers get. This is because they cover a lot of daily operations and potential problems you may encounter while running your business. We highly recommend meeting with insurance companies to sign up for these plans and protect your business.

General Liability

General liability insurance is your first step in signing up for the different types of business insurance. This insurance protects your business against claims for third-party bodily injury and property damage as well as personal and advertising injuries, which involve claims for copyright infringement, slander, libel, and false advertising. This kind of policy will cover most of your expenses for lawyer’s fees, damages, losses, etc. 

Professional Liability

You will need either professional liability insurance or errors and omissions insurance. These types of business insurance offer protection against claims of mistakes, negligence, inadequate work, inaccuracies, and misrepresentation. In other words, this insurance protects your businesses from unhappy customers suing you over mistakes by providing coverage for the damages. 

Commercial Property 

If you have a workshop, office, or any other business property for your operations, you need commercial property insurance. This insurance protects against damages to your property and all the items within it when there is a natural disaster, fire, smoke, or vandalism. 

But business property insurance isn’t just for your office. Smartphones, computers, and special equipment needed for your business are also covered. If your business is based in your home, you will typically rely on your homeowner’s or renter’s insurance, and if you travel with your items, such as photography equipment, you will need to consider inland marine insurance to protect your property in transit. 

Workers’ Compensation

Workers’ comp isn’t just for companies with employees. Self-employed insurance with workers’ compensation also covers the cost of medical expenses, disability benefits, and lost wages while you recover. Most states require by law that you have workers' compensation insurance if you have at least one or more employees.

Other Types of Business Insurance

The following list of insurance coverages may not be needed, depending on your business and where it is located. Nonetheless, we recommend that you research these plans and meet with an insurance agent to see if you can add these to your current policy. 

Business Interruption

You have no control over natural disasters, and that’s why you need business interruption insurance to cover the loss of income when you cannot operate your business. This can range from a local warning to stay indoors due to a hurricane or closing your home office in the case of an electrical fire. 

Commercial Auto

You will likely need a commercial auto insurance policy if you use your own or another vehicle often for business purposes. You may be able to expand your personal auto insurance, but be aware that they also may not have adequate coverage. It’s important to sign up for business auto insurance because if your vehicle is separate from your own, your personal policy will usually not cover an accident.

There is also hired and non-owned auto insurance that will offer liability coverage for vehicles that you borrow, rent, or hire for your business. It also applies to employees using their vehicles on the behalf of your business. 

Cyber Liability

Modern-day technological advancements have made the public aware of data breaches and software hacks. Cyber liability insurance covers the cost of notifying customers, setting up monitoring, and investigating attacks from hackers breaching your computer system and stealing customers’ payment information. 

A cyber insurance policy isn’t just for big companies; all businesses that use technology to function should have it. In fact, since bigger companies tend to have stronger security systems, small businesses are at a higher risk of a data breach. Cyber insurance has many benefits, and carefully handling your customers’ data is an absolute priority to consider. 

Commercial Umbrella

Commercial umbrella insurance is a great option to add extra coverage to your general liability insurance. The way that it works is that umbrella insurance will cover the costs that go beyond the coverage limits of your general liability insurance. You don’t necessarily need an umbrella insurance policy, but if you can afford it, the future of your business will thank you if it ever runs into a situation where you need more coverage. 

Get Coverage with Cannon Connect

Now you know about the different types of business insurance you may need as a self-employed worker. We recommend hiring an insurance agent with your best interest at heart to get the insurance coverage you need. 

If you are looking for self-employed business insurance that includes workers’ compensation and health insurance, you can access those benefits when you become a member of Cannon Connect. We make health care, life insurance, and retirement affordable to our community of entrepreneurs, startups, and small business owners. Our program is available to companies with at least two employees, e.g., a founder and one full-time employee. 

If you don’t meet those requirements, no worries! We are proud to be the world’s most valuable entrepreneurial network. Your fellow members and professional advisors can help you navigate getting the best coverage at the best price. On top of that, you get exclusive access to resources for business success. We’re made by entrepreneurs, for entrepreneurs. 

Join Cannon Connect to get started today on your benefits program and join the ever-growing community that supports entrepreneurialism around the world.

Brad True

Brad oversees all overall day-to-day operations of The Cannon and its growing community, including all current and future Cannon locations and Cannon Connect, The Cannon's new online platform. He holds an undergraduate degree in marketing from Texas A&M and a graduate degree from the University of Oklahoma.