Freelancers and 1099 contractors are their own business, which means their client’s insurance usually does not protect them. Many clients now require contractors to carry their own insurance and provide a certificate before work begins. Here is what you need to know.
Why independent contractors need insurance
- Clients and general contractors often require proof of coverage in the contract.
- A single claim for injury, property damage or a professional mistake can exceed your annual income.
- Insurance makes you look more professional and helps you win larger contracts.
Common policies for independent contractors
- General liability: essential for contractors who visit client sites or work with the public.
- Professional liability: important for consultants, designers, IT professionals and other service providers.
- Tools and equipment insurance: protects the tools you carry from job to job.
- Commercial auto: if you use a vehicle mainly for business or transport tools and materials.
- Workers’ compensation: required if you hire employees, and sometimes requested by clients even for sole proprietors.
Typical client requirements
Contracts often specify minimum liability limits, require the client to be added as an additional insured, and ask for a certificate of insurance. Read your contracts carefully and make sure your policy matches the requirements before you sign.
Tips for buying contractor insurance
- Choose a policy that lets you add additional insureds and issue certificates quickly.
- Describe your work accurately so claims are not denied.
- Review coverage when you add new services or bigger clients.
Get covered before your next contract
Freelancers and contractors can get a quote online and share a certificate of insurance with clients right away through NEXT Insurance.
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Frequently asked questions
Does my client’s insurance cover me?
Usually not. As an independent business, you are typically responsible for your own coverage.
What is an additional insured?
A person or company, often your client, added to your liability policy so they are protected for claims arising from your work.
How fast can I get a certificate of insurance?
With many online insurers, you can download a certificate immediately after buying a policy.
Related business insurance guides
This page is for general information only and is not insurance, legal or tax advice. Requirements, coverage and prices vary by state, industry and insurer. Review policy documents and speak with a licensed agent before buying.