Business insurance for the self-employed
Being your own boss is a freedom worth protecting. But self-employment comes with responsibilities – like making sure your company has the right protections in place if someone were to make a claim against your business.
With AXA Business Insurance you can tailor your cover to best suit your needs. Choose the covers you need at the level that’s right for your business, as well the optional extras that fit your needs.
Why do I need business insurance when I’m self-employed or a sole trader?
Business insurance is important for all businesses, self-employed, sole trader, or otherwise. It protects your business from claims made against it, covering any fees for defending against a claim and paying out any compensation due.
Different occupations will have different risks associated with them. For instance, what would you do if you’re a builder and a client of yours gets injured while you’re carrying out some repairs for them? A consultant who’s advice has caused a client to lose money? Or a baker who’s newest recipe has made several customers sick?
Additionally, some clients might require you to have certain covers in place before you can complete work for them, such as local authorities (councils, government bodies etc) who are likely to request you have, at minimum, public liability insurance.
What covers should I consider?
There are four covers we offer business insurance customers:
- Public liability insurance
- Professional indemnity insurance
- Contents insurance
- Employers’ liability insurance
If you’d like to learn more about the cover options available to you, keep reading.
Nearly all businesses need public liability insurance as they are bound to be in contact with clients, customers, or the public at some point. Public liability insurance protects you from third-party claims of accidental damage or injury resulting from your business activities.
If you sell or supply products, then you’ll also be automatically covered by products liability as part of your public liability insurance. This covers you for multiple claims caused by the same products – e.g., a batch of cakes makes several customers sick, or a collection of jewellery you’ve sold causes skin irritation for numerous customers.
What are some examples of public liability claims?
Public liability insurance will protect you from third-party claims of accidental injury or damage. For example, a self-employed hairdresser who makes house calls and has spilled hair dye on their customer’s brand-new couch.
Professional indemnity insurance is designed to protect professionals from claims made by a client when their advice or negligent services has caused the client to lose money. It includes a range of covers such as:
- Civil liability claims
- Breach of professional duty
- Breach of confidentiality
- Defamation, libel, or slander
- Breach of copyright
- Loss or damage of documents in your care
What are some examples of professional indemnity claims?
Depending on the line of work you’re in, there’s a whole host of potential situations that may create a need for professional indemnity insurance. For example, you’re an accountant whose client has entrusted you with sensitive financial information. A mistake on your part has saw the data unintentionally shared with unauthorised people.
Whether your business is based at home, in an office, or a shop – if you’ve got contents or stock, contents insurance is for you. Contents insurance is there to help you replace your contents – for example; any fixtures and fittings, stock, a shop front etc – if the worst should happen.
What are some examples of contents insurance claims
Contents claims can look very different depending on the type of business you have. Here are a few examples of the types of situations that would result in a contents insurance claim. For example, your stock has been damaged through no fault of your own, for example, in a flood or fire.
If you have anyone working for you – in any capacity - then you need employers' liability insurance. This is a legal requirement under the Employers’ Liability Act 1969 and protects your employees if they get injured or become ill as a result of working for you.
What are some examples of employers’ liability claims?
Sometimes accidents happen, so it’s important that if an employee has an accident or work, or gets sick due to their job, that you’re prepared. Here are a few examples of what would be classed as an employers’ liability claim. For example, a self-employed contractor who suffers serious leg injuries after scaffolding falls.
Is business insurance a legal requirement if you’re self-employed?
Public liability, Professional indemnity and Contents insurance are not legal requirements for UK businesses. However, you may find that some contracts (such as local authorities) require public liability cover in order to work with you.
If you have anyone working for you – in any capacity and for any length of time - then Employers’ liability insurance is a legal requirement.
Additional covers for the self-employed and sole traders
Own plant, or hired-in plant, tools and equipment
If you’re a tradesman, then you may want to consider own plant tools and equipment. We can cover you for your own plant tools and equipment or hired in plant.
Business equipment
If you’re a professional, and use your computers, mobile phones, tablets, or other equipment then you’ll need business equipment cover. If you’re working out of your home, then they probably won’t be covered by your home contents policy.
Personal accident
Does your business rely on you? Consider how your income would be affected if an injury leaves you unable to work. In this case, your personal accident cover would pay your wage until you recover. Maximum limits apply.
Legal expenses
Legal expenses can help if you find yourself in need of legal help for whatever reason. It covers things such as hiring a solicitor, defending yourself against a claim, or pursuing a claim against someone else.
How much does business insurance cost when you’re self employed?
On average, AXA Business Insurance customers pay £81* per year or £6.72** a month for cover.
However, no two business insurance policies are the same. Your policy price is tailored to your business needs, so the quickest and easiest way to find out how much your policy will cost it to get a quote.
Plus, get a quote online today and you’ll receive a 10% discount° for buying online.
GET A BUSINESS INSURANCE QUOTE
What factors might affect the cost of premiums for self-employed people and sole traders?
There are several factors for self-employed people to take into account when it comes to the cost of their policy. For example:
- What is your occupation? – Are you a trades person, and if so, does your trades have a higher risk profile? Or are you a professional who spends the majority of your time working from an office?
- Where you work – Are you working from a premises? From home? Do you visit customers or clients?
- Do you have tools or equipment that need protecting? – Will your work be seriously impeded if your tools get stolen, or your laptop breaks down?
- Do you have employees? – Are you making sure you have cover in place to protect them?
All these things play a factor in the cover you choose and, ultimately, the price you’ll page.
What self-employed occupations do AXA cover?
We cover a long list of occupations - here are just a few of the occupations we cover that are popular with self-employed customers.
- Builders
- Hairdressers
- Cleaners
- Couriers
- Gardener
You can see a more thorough list of some of the main occupations we cover with our handy occupation A-Z search.
Frequently asked questions
What’s the difference between public liability insurance and professional indemnity insurance?
The main difference between public liability and professional indemnity is the TYPE of situation you're covered for.
Public liability
Public liability insurance covers you against accidental injuries caused to other people from your business/products as well as any damage caused to a third party's property.
Professional indemnity
Professional indemnity insurance covers you for the financial loss your client may have suffered as a result of your bad advice, poor services or inadequate designs that ended up resulting in financial loss for that client.
If you want to learn more about the difference between professional indemnity and public liability insurance why not check out our hand guide: Professional Indemnity or Public Liability Insurance?
What’s the difference between being self-employed and being a sole trader?
These two terms are often used interchangeably as they broadly mean the same thing.
The difference between being described as either self-employed or a sole trader is simply how your business is structured.
Self-employed
Self-employed means just that – you are not employed by anyone, and you work for yourself and don’t pay tax through PAYE.
Sole trader
Sole trader describes your business’ structure – it means there is no separation between you and your business. You’ll likely be registered with the government under your own name or a business name.
Do sole traders require any additional insurance?
No, sole traders require the same covers as most other businesses. Being a sole trader simply describes the structure of your business, rather than any business activities that will affect the types of cover you need.
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Business advice
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*10% of our customers paid this or less between October and December 2023.
**10% of our customers paid from £6.72 for ten months between October and December 2023 after an initial deposit. Interest applicable. For more details see our terms & conditions.
°This discount is applied automatically and lasts for the lifetime of your policy.
