If you’ve recently started a side hustle, whether to supplement your primary source of income, because you’re furloughed and trying something different, or to explore the potential monetisation of a much-loved hobby, you’ve probably been pretty focused on marketing yourself or your product and perhaps checking up on tax implications. What you likely haven’t given much time for is insurance.
Yet no matter how small your business (and you may not really even consider it a business), if you’re selling a product or service, it can really pay to be protected - and it won’t necessarily cost you much.
The good news is: sorting out your business insurance is far simpler (and quicker to do) than either marketing or tax returns - it’s true!
How do I work out what cover’s relevant for me?
All you need to do is evaluate your business and figure out what risks it involves. ‘Risk’ may sound abstract and a little daunting, but it’s a fairly straightforward concept: “The possibility of something bad happening”. It’s quite simply anything that could happen as a result of your side hustle that may result in someone taking legal action against you. This can be anything from a personal injury claim against you to a client suing you for breach of contract.
The risks you face will vary depending on what your side hustle is, and who and how you interact with other people as part of your business. Are you selling a handmade product, or offering a service, such as pet-sitting, or tutoring? While business insurance is an umbrella term covering a multitude of different types of cover for different risks, you can get a combination of covers - and the right level of cover - to match the specific risks you face.
Below, we’ve listed a few examples of common side hustles and the covers that may be especially relevant to each.
What cover do crafters need?
Planning to sell your wares at a craft fair, or on Etsy? That’s already at least two types of cover to think about: public liability insurance and product liability insurance. Public liability insurance may offer cover if you’re sued by a member of the public (anyone) due to injury or damage to their property while you’re working (e.g. while manning your stall at a craft fair). Product liability insurance may cover legal and compensation costs if a customer claims that they’ve been injured due to your product.
Not to mention business contents insurance, which you may want if your craft involves specialist equipment (say, a pottery wheel or a printing press). This cover is designed to cover the cost of repair or replacement of your specialist equipment, which would otherwise be costly to replace.
What cover do tutors need?
As a tutor, you’re likely to be around people (unless you’re purely working from home) and you’re trusted to impart knowledge to your students. This involves two specific covers: public liability insurance and professional indemnity insurance.
Public liability insurance is designed to cover legal and compensation costs in the event that a member of the public (e.g. your client - student), is injured or their property damaged while you’re working. This could be something as mundane, although painful, as injuries caused by a misplaced cup of scalding tea.
Professional indemnity insurance is designed for any work which involves giving advice in a professional capacity. If you’re sued for giving advice or not fulfilling a contract, professional indemnity insurance may cover your legal and compensation costs.
What cover do freelance social media consultants need?
As social media consultant you’ll want to consider professional indemnity insurance, particularly for a specific aspect of this cover, called media liability.
While professional indemnity insurance covers general risks around your contractual obligations, media liability insurance (which is included with Superscript’s professional indemnity insurance) focuses on the specific risks involved with working with creative content. If, for example, you were to unintentionally craft a tweet or an Instagram post which attracted negative attention, causing your client financial and reputational damage, they may sue you. If you're an influencer, this is a cover to think about too.
What cover do freelance fitness instructors need?
If you’re taking fitness to the next level - regardless of the sport - insurance is available to protect you. When it comes to being paid to give advice, it’s a good idea to consider professional indemnity insurance, which may provide cover if a client were to sue you for giving detrimental advice. If you’re training with clients in person, public liability insurance is also something to think about. To find out more about cover for fitness instructors, visit our fitness instructor insurance page.
Is insurance a legal requirement?
Unless you’re employing anyone (in which you’ll need employers liability insurance and if you don’t you could be fined £2,500 for each day you don’t have it), you don’t have to be covered by insurance. But this isn’t really the point. When it comes to insurance, the key thing to ask yourself is: "Could I afford the cost of a claim in association with this risk?" For many, that answer is “no”.
Still not sure about what cover you need? Check out our simple guide to the different types of business insurance, or simply go through our quotation process. It takes less than 10 minutes and guides you through your options to help you make the best decision for your business. If you don’t want to buy cover now, don’t worry - your quote's valid for 30 days.
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- 10 November 20207 minute read
Read Emma's story who has taken the impact of COVID-19 as an opportunity to pursue her passion of yoga full time.