What types of insurance are "industry standard" for sole proprietors?

October 4, 2019 8:10 AM

I'm a sole proprietor (writer/editor), and I've got a client asking me to sign a contract stipulating that I carry insurance "at least to industry standard." What types of insurance would be considered "industry standard" for a writer/editor with no employees?

I'm a sole proprietor (writer/editor), and I've got a client asking me to sign a contract stipulating that I carry insurance "at least to industry standard." Then they promptly also said that I should have workers' comp insurance, which as far as I can tell, is *not* standard for someone without employees. Two questions:

1) What types of insurance would be considered "industry standard" for a writer/editor with no employees?
2) Regardless of industry standard, what type of insurance should I have for my own protection?

Thanks!

posted by MelanieMichelle to Work & Money (8 answers total)

I am a sole proprietor working as a professional author and editor. I don't carry insurance and certainly not workers comp--I've heard about authors who have formed LLCs carrying liability but it's not the standard.

Here's a blog post on exactly that topic.
posted by PhoBWanKenobi at 8:20 AM on October 4, 2019 [1 favorite]

Not a lawyer, but do work with them regularly on contracts.

Strike it or ask for a call with their counsel. There is likely a specific type of risk that the organization is trying to avoid with the language. Once you understand that, you can either go quote the necessary insurance, indemnify the client, or insist on striking.

It could be as simple as they want to avoid a lawsuit for you getting a repetitive stress injury while working for them.

I would assume they are looking for general liability policies. You may also want to consider error & omissions.
posted by bfranklin at 8:23 AM on October 4, 2019

Best answer: I have general liability, workers comp (it was so cheap it was easier than doing all the waiver crap), and an umbrella policy to get my car policy up to $1mil (i dont use my car in anyway for them but they had an issue with a vendor on their property and so insist on this now, it cost almost nothing!) A client wanted that stuff and it cost so little extra it was worth it. They also asked for some other thing which was like if i do something that harms their brand then i can be liable. My agent noped me right out of that and they were fine with it. Turned out they switched to a new boilerplate and it added language they didn't really care about. Quick strike out and on we went status quo.

So, my 2 cents is get general liability, workes comp, and maybe an ubrella which kicks in after a certain point for any kind of claim. It's cheap and protects you for any circumstances. Fwiw i basically use a computer all day, so although what i functionally do is different, mechanically it's the same.
posted by chasles at 8:33 AM on October 4, 2019 [1 favorite]

There's a tradeoff here between painting a target on your back by having a policy (thus making it potentially worthwhile for someone to sue you), and protecting any substantial assets you have. (Judgment creditors can take your house, although this doesn't happen very often.) How you weigh that tradeoff will depend on your particular circumstances, but it's something to consider.

As far as I know, the "industry standard" amount of liability coverage for writers/editors is $0, so I guess you could just say "yes, I have the industry standard level of coverage." Of course, some might consider that misleading. ;-)

How much business is this client offering you? How solid is the offer? In the translation field, agencies that demand insurance are notorious for never coming through with any actual work.
posted by shenderson at 8:49 AM on October 4, 2019 [1 favorite]

I’m a career freelancer, and I just strike out this sort of requirement. It’s just boilerplate, and your client probably doesn’t even know what it means.
posted by Ideefixe at 9:28 AM on October 4, 2019 [1 favorite]

When my wife's business was a sole proprietorship, we carried liability, workers comp and an umbrella policy. We had employees, so the worker's comp was a no brainer. All the insurance together cost very little.
posted by Lame_username at 12:12 PM on October 4, 2019

If they are going to use a phrase a vague as "industry standard" then the standard for a freelance writer would "none." So you would be compliant. But you could also just strike it out as others suggested.

This is boilerplate language that really applies to other types of contractors. What conceivable liability could you be exposing them to? If you operated heavy machinery or had employees driving vehicles it would make more sense.

As far as workers comp insurance, that also is pretty silly for a freelance writer. You could show them that you have your own health insurance, which would cover any injuries that occurred while you were working in your home office. If you are working in their office, then conceivably you could fall out of your chair and they would be liable if you don't have your own workers comp.

Some employers are getting down right abusive in their contract requirements. You can push back and at some point just decide certain assholes aren't worth working for.
posted by JackFlash at 4:47 PM on October 4, 2019 [1 favorite]

What the client is looking for is evidence of errors and omissions insurance.

The client does not care about general liability or workers' compensation. It wants to be sure that there is some recourse if you make a mistake in doing your work. That is E&O coverage.
posted by megatherium at 4:57 PM on October 5, 2019