Have you ever lost out on a project to a cheaper designer or developer? Your hourly rate eclipses their daily rate, but with good reason.
You have years of experience, a roster of happy clients and sharp skills. You've solved problems like this before with great results. You know you're a better suited candidate for this job.
Yet it doesn't matter. The client has based their hiring decision on budget, so they chose the cheapest freelancer—even though they're not quite right for the job.
I see this happening a lot in insurance. Freelancers choose the cheapest policy, even though it's not the best fit for their work.
You've heard the expression, "You get what you pay for". This mantra also rings true for insurance. Basing your insurance purchase solely on price is problematic for a few reasons:
When only looking at the price of the premium, you ignore the most important factor—policy features. If one policy is £50 dearer, it's likely because the level of cover is more comprehensive. Does your policy cover you for everything you need?
With a cheap product, can you feel confident your insurer will pay out in the event of a claim? We all hope we'll never have to call on the services of our insurance provider, but when we do it pays to have a good policy.
Premium price, premium product. There is much more to insurance than just the policy. What about ease of purchase, customer service and quality?
I get it. I may work in insurance, but I'm also in the market for buying it. Home, car, life, business etc…
I'd much rather spend my money on other things. Because of that, I understand the temptation to cut corners when buying insurance. But putting price first can be a costly mistake.
So, what can you do?
Instead of approaching insurance as an unnecessary add-on, budget for it when considering business expenses (remember, insurance is a tax-deductible expense).
Secondly, when shopping for insurance ask the provider what features their policy offers that other policies don't. The professional indemnity policy we arrange has third-party cyber liability and a website recovery service.
Lastly, if you're new to freelancing and don't have the budget, you can opt for a lower level of cover and increase as you bring on more clients. This is called a mid-term adjustment.
The price of insurance varies between providers, but the true cost of a cheap policy could be devastatingly expensive. For the sake of your business, don't put price first when buying insurance.