Do I Need Insurance For My Freelance Business?

To learn all about business insurance for freelancers, we interviewed Ashley Baxter who runs With Jack. They provide business insurance, especially for freelancers, supporting them financially and legally.

Ashley explained the ins and outs of being insured, and why having insurance frees up your biggest asset - your creativity.

What are the most common types of claims you see?

We see the same problems over and over again. Most of them are to do with poor project management, which could be the fault of the freelancer or the client.

The work isn’t delivered on time or to a standard the client isn’t happy with. This could be down to the freelancer or because the client hasn’t signed it off on time or they’ve changed their mind halfway through the project.

The client then makes a claim to recover the costs of not being able to launch on time or having to hire other freelancers to get the project up to speed or standard.

How do most problems start, and how could they be avoided?

You might never altogether avoid a problem, but there are things that you can do to reduce the risk of the issues happening. And then if they do happen, managing them better.

Firstly, make sure you have a contract in place because a lot of the time when problems do occur the contracts can just be referred back to.

Having a project scope, that’s a huge one, making sure that the client knows exactly what they’re getting, what’s included in the scope and what isn’t, what’s budgeted and accounted for in the timescale.

Also, having the confidence and conviction to handle clients who are starting to show some red flags.

You talk about being a confident freelancer. What does this mean practically speaking?

I think it means having these processes in place and then having the conviction to stand by them. Understandably freelancers want to keep the client happy but you shouldn’t do that at the expense of yourself.

You have to go into projects knowing what you’re worth. You have to go into projects with competence so that if clients start trying to take advantage of you, you can instantly put them in their place and being insured helps you do that.

Having insurance can give you the confidence to stand up to your clients and say, ‘no, hold on a second, I’ve done the work that you’ve asked me to do, and I’ve done it to an excellent standard. You’re not entitled to any funds back.’ And you’ll know that if they do push things that little bit further, you have insurance to step in and handle it all for you.

So… do I need business insurance?

None of us should be accepting projects or working with clients expecting things to go wrong. But if they do, your insurance will work much the same way as a seat belt. And you might be the best driver in the world, but you can’t control how others behave. My advice is to not procrastinate on it and get insurance set up as soon as you start trading. It’s tax-deductible too. 

Only a small percentage of freelancers will have to use the practical element of it. Still, you will benefit from it on an aspirational level every day because it helps you go into projects feeling confident and that will also free up your ability to be creative and do your best work.

Could you briefly explain the different types of cover With Jack offer and approximately how much they cost?

At With Jack, we offer four products through our website. Professional indemnity which is insurance for mistakes you might make in your work or problem clients. It gives you access to legal experts who step in and handle things, and it covers any compensation agreed with the client. It costs around £14 a month. 

Public liability covers you if somebody sustained an accident or had an injury due to your work activities. This isn’t at all common with freelancers, but it only costs about £2 a month. 

We also provide contents insurance. The price varies a lot depending on your equipment, but for example, it might cost about £40 a year to insure a £2000 laptop. And we have a legal expenses product where you can pick up the phone and speak to a legal expert and ask them questions to do with client conflicts or contract disputes. It also provides a late payment service with a solicitor who will chase overdue invoices on your behalf, and this costs about £5.50 a month.