Self-Employed Business Insurance

Q: Is business insurance required for the self-employed?

In most cases, business insurance is not legally required by federal law if you are self-employed with no employees. However, it often becomes "mandatory" in practice due to state laws, industry regulations, or client contracts.The requirement depends on three main factors:- State and federal law: Workers' compensation is required in most states if you have employees. In addition, commercial auto insurance is mandated in most states if you use a vehicle primarily for business.- Professional licensing: In many states, you cannot get or renew a professional license without proof of insurance.- Contractual requirements: Even if the law doesn't care, your clients will. Most large companies and government agencies include a "Certificate of Insurance" (COI) clause in their contracts.

Q: Do I need insurance as a self-employed business owner?

Most states require you to carry workers’ compensation insurance if you have employees. There also may be licensing requirements for certain liability coverages. We recommend checking with your state and local governments for self-employed business insurance requirements.

Q: How much does business insurance cost for a self-employed person?

The cost for your insurance coverage is determined by:The type of work you doWhere your business is locatedYour annual revenueThe types of policies and limits you chooseOther factors can include your claims history and how long you’ve been in business.

Find out what self-employed business insurance coverage you need. Compare policies from leading national insurers. Get a quote in minutes.

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Self-Employed Business Insurance

Find out what self-employed business insurance coverage you need. Compare policies from leading national insurers. Get a quote in minutes.

Get Started

One application, multiple quotes. All in one place.

Over 1M customers worldwide.

What is Self-Employed Business Insurance?

Self-employed business insurance is a specialized set of coverages designed to protect independent workers from financial losses due to lawsuits, property damage, or professional errors. Being self-employed means managing clients, chasing deadlines, and keeping projects on track — often all at once. And when unexpected mishaps pop up, the impact can derail your momentum. Simply Business makes it simple, fast, and affordable to protect your work, so you can stay focused on what you do best.

Do Self-Employed Individuals Need Business Insurance?

While business insurance is not universally required by federal law, self-employed individuals often need it to satisfy client contracts, meet state licensing requirements for specific trades, and protect personal assets from high-cost professional lawsuits. Even without a legal mandate, carrying coverage like general liability or professional liability is a strategic necessity to build credibility and ensure that a single property damage claim or error doesn’t lead to personal bankruptcy.

What Insurance Does a Self-Employed Business Owner Typically Need?

General Liability Insurance

Foundational insurance coverage for a self-employed business owner to help handle costs from third-party accidents, property damage, and bodily injury.

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Workers’ Compensation Insurance

Coverage to help take care of employees who get sick or injured on the job. Most states require this for small businesses with full- or part-time employees. It also can benefit business owners who don’t have employees.

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Inland Marine Insurance

Financially protect the tools and equipment you use while in transport or on a jobsite.

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Professional Liability Insurance

Coverage for business mistakes that result in damages, legal costs, and negligence claims.

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What Does Self-Employed Business Insurance Cover?

Running your own business puts you in control, but it also means you’re the one navigating unforeseen setbacks. Self-employed business insurance can provide a safety net for some of the most common claims small business owners face:

Damage to someone else’s property

While installing new trim in a client’s entryway, a handyperson’s misplaced swing leaves a noticeable dent in the wall. A general liability policy can help cover this type of third-party damage and protect your business from out-of-pocket costs.

Care for sick or injured employees

An independent electrician wiring a ceiling light slips off a ladder and fractures their ankle. When you’re self-employed, accidents like this can affect every part of your business.

Workers’ Compensation Insurance typically helps employees who get hurt on the job, and in some states, it may also help cover the business owner’s work-related injuries, offering financial support while you recover.

Damaged or stolen equipment

After a lunch break, a photographer returns to their car and discovers a camera bag has been stolen out of the vehicle. When your equipment is your livelihood, replacing it fast matters. Inland marine insurance — also known as contractor’s small tools and equipment insurance — can help cover the cost to repair or replace your essential gear so you can get back to work quickly.

Honest mistakes and negligence claims

A mobile hairdresser applies a color treatment, and a slight timing slip leaves a client with scalp irritation and noticeable damage. Even experienced professionals can sometimes be a shade off, and a professional liability policy could help cover the cost of resolving a claim and protect you against related legal expenses.

How Much Does Self-Employed Business Insurance Cost?

The cost of self-employed insurance varies for every small business. There isn’t a one-size-fits-all answer, as your price depends on several unique factors.

Factors that affect your self-employed business insurance cost

While prices vary, we can offer accurate quotes tailored to your specific needs. Your estimated price is usually based on:

Specific business details
Your business’s location
The services you provide
Your estimated annual revenue

Get Your Self-Employed Business Insurance Quote

Try our self-employed business insurance Calculator.
Get a quick estimate in just 3 steps.

Get your self-employed business quote

Try our self-employed business insurance Calculator.
Get a quick estimate in just 3 steps.

Why Choose Simply Business for self-employed businesses?

We get your business

Forget one-size-fits-all insurance. We cover 400+ types of trades, everything from handymen to photography to craft vendors. We understand your business and customize insurance to meet your needs.

We’re fast and affordable

Get free business insurance quotes in under 10 minutes, because who wants to spend hours learning about insurance?

We’re human

Insurance can be complicated. But whether you’re browsing our site or talking to one of our agents, we’re here to simplify the business of small business insurance.

Answers to More Self-Employed Business Insurance Questions

Is business insurance required for the self-employed?

In most cases, business insurance is not legally required by federal law if you are self-employed with no employees. However, it often becomes “mandatory” in practice due to state laws, industry regulations, or client contracts.

The requirement depends on three main factors:

– State and federal law: Workers’ compensation is required in most states if you have employees. In addition, commercial auto insurance is mandated in most states if you use a vehicle primarily for business.

– Professional licensing: In many states, you cannot get or renew a professional license without proof of insurance.

– Contractual requirements: Even if the law doesn’t care, your clients will. Most large companies and government agencies include a “Certificate of Insurance” (COI) clause in their contracts.

Do I need insurance as a self-employed business owner?

How much does business insurance cost for a self-employed person?

Do I need business insurance if I work from home?

We recommend you have home-based business insurance. It’s a type of coverage that can typically help cover the costs of an unexpected accident, injury, or property damage. It’s designed to help cover your business if it’s primarily located within your home.

Because most traditional homeowners policies don’t cover incidents relating to a home business, it’s important to get additional coverage.

Why work with Simply Business?

Small business insurance is what we do. Whether it’s covering you for accidents and errors, meeting workers’ comp requirements, or protecting your shop and your tools and equipment, we can help find the coverage you need for your business.

We provide customized coverage options and quotes from top-rated small business insurers — all in just 10 minutes. More than 1 million small business owners worldwide trust us with their insurance, and we consistently earn high customer ratings and reviews.

Feel confident in your choice.

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