Do you know what kind of Business Insurance you need as a freelance computer programmer? Some of your risk is no different from that pizza parlor down the block, but not all. Your technology work puts you well beyond the scope of basic business coverage. Computer Programmer Insurance fills in the specialized gaps that standard business policies don't cover.
#1: General Liability & Property Insurance for a Freelance Computer Programmer
Like a store with a brick-and-mortar location, you need coverage for your physical assets, such as equipment and supplies, as well as for customer/client injuries due to accidents or negligence. And if a delivery man slips on your sidewalk, or a visiting client trips over a power cord, you could get slapped with medical expenses and lawsuits. Most Homeowner's or Renter's policies don't cover liability or property damage to business property, even if you work from home, so you have to seek protection elsewhere.
Luckily, as a freelance programmer, you probably qualify for a Business Owner's Policy (BOP), which bundles both Property Insurance and General Liability Insurance together for a single discounted premium.
The Property portion shields your equipment and gear, while the General Liability protects you from allegations of third-party injuries and property damage.
#2: Cyber Risk Insurance for Freelance Computer Programmers
The most significant difference between you and that pizza joint is the amount of cyber liability you face. Cyber crime and cyber accidents are just about as serious (read: expensive) as it gets when it comes to threatening your programming business. You can be held responsible for all kinds of damage relating to data breaches, malware, invasion of privacy, data tampering, regulatory action, and more.
These are no small risks. You may have heard horror stories about large technology firms bellying up data breach settlements in the millions of dollars. One staggering account totaled losses in the billions. But small businesses are just as vulnerable to cyber threats. Here's why:
- Smaller businesses (including freelancers!) typically have few resources to devote to cyber security measures.
- Data thieves see small businesses and sole proprietors as a prime opportunity for theft.
- Programmers and other IT professionals often have access to lots of valuable information for the clients they serve.
Don't think it could happen to you? Don't be so sure: one small IT firm recently entered a six-figure settlement for a data breach incident. (Find out how to protect yourself in the article "10 Things You Can Do to Protect Your Tech Business against Cyber Attacks.")
#3: Errors & Omissions Insurance for Freelance Programmers
Data breaches aren't the only hazard that threatens the programming sector. You're also accountable for any advice you give, any work you do, and anything you forget to do for your clients. So if, for example, you recommend a new type of software for a client and that software causes their system to crash, you could face a lawsuit for the damages (aka the money they lost while their system was down).
To protect yourself against such expenses, you'll need a robust Errors & Omissions Insurance policy, which pays for the legal costs associated with accusations that your professional work caused one of your clients a financial loss.
Choosing a Deductible: How Low Can You Go?
For freelancers, business insurance may seem like one more unnecessary (or unaffordable) expense clogging an already-tight budget. And if you do decide to purchase coverage, you may be tempted to save money by choosing a higher deductible (the amount you pay out of pocket before benefits kick in).
Keep in mind, though, that you shouldn't pick a deductible that's higher than what you can realistically afford. If you can't afford your deductible, your insurance might as well not exist.
Still have questions about how Tech Insurance works? Talk to a TechInsurance agent to make sure your business is covered, or get a free quote instantly.
Writtten by Brenna Lemieux - check her out at Google+ or Twitter