Do You Need Business Insurance For Your Side Gig?

You may view your side gig as an easy way to pick up some extra cash. But you need to treat it just as seriously as you would any other business. If something goes wrong, it's possible to lose not just what you've earned but also everything you own. To protect yourself, you need to look at business insurance.

Does Your Personal Insurance Cover Side Gigs?

You might think that you’re fully covered for a side gig under existing insurance. For instance, you might expect your homeowners or renters insurance and car insurance to work together to protect you. These coverages could guard against just about any kind of liability you could reasonably expect to encounter at home or on the road. Your employer’s insurance would also likely cover you if something happened at your day job.

However, neither of these coverages specifically cover your side gig. That project counts as a business activity, and most homeowners, renters and car insurance policies exclude business activities. Similarly, your employer’s insurance coverage is unlikely to cover you for non-company activities.

What Happens If You Hurt Someone?

Let's say you’re sitting outside using your laptop, with your backpack next to you. Someone trips on your backpack and ends up going to the hospital for their injuries. Will you need to cover their medical bills or pay for a lawyer to defend yourself?

If you were on leisure time, you might be covered. But you’re doing client work or are on a client meeting, that would probably be considered an excluded business activity, and you likely wouldn't have coverage.

To protect yourself against the above types of injuries and injury claims as a more direct result of your work, you want commercial general liability insurance.

What Happens If Your Mistake Costs Someone Money?

Now assume you were hired as a computer programmer to build a website. The website didn't work and the store that hired you lost weeks’ worth of sales. Whether the store can successfully sue you depends on a lot of things that you'd need to talk to a lawyer about. The important thing is that you're aware this is possible and the amount in question could be far more than your entire net worth.

These types of claims may fall under general liability, errors and omissions, professional liability, or other types of business insurance.

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