You can read how this works exactly and why you should consider this insurance as a freelancer in this blog post.
1. What is liability insurance exactly?
- What is liability insurance exactly?
- What do you need liability insurance for?
- How much does it cost?
- This is how you arrange your liability insurance as a freelancer
According to Investopedia: it provides an insured party with protection against claims resulting from injuries and damage to other people or property. Liability insurance policies cover any legal costs and payouts an insured party is responsible for if they are found legally liable. Intentional damage and contractual liabilities are generally not covered in liability insurance policies. Unlike other types of insurance, liability insurance policies pay third parties, not policyholders.
2. What do you need liability insurance for?
Suppose you are working for a customer and someone falls over your laptop bag. Annoying, but it can happen.
Other examples are:
- A customer who takes you to court
- Copyright Infringement
- Data breaches or cyber attacks
- Damage to property or equipment
Reasons enough to take out insurance if the damage is sufficiently large. As a freelancer, you will often also have to take out liability insurance before you can start an assignment at a company. Especially at larger companies.
3. How much does it cost?
How much you pay for your policy as a freelancer depends on a number of factors:
- The work you do
- The risks you run
- How high the coverage should be
That's usually between 100 and 500 euros per year.
4. This is how you arrange your liability insurance as a freelancer
As with any insurance (or contact) it is recommended to read the small print, so that you are not faced with surprises. In exceptional cases it will not be possible for you to take out liability insurance. This is because the profession does not allow to define the damage risks or the chance of damage is simply too high.
You take out liability insurance with insurance brokers and most banks. Request a few proposals, so that you know what the different conditions and coverage options (and prices) are.
Tip: next to liability insurance you can and should additionally protect yourself with sound contractual agreements between yourself and your client.
Securex is ready to advise you on insurance or to answer all your legal questions.
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