Some freelancers think insurance is pointless because their fees are small. If they’re charging £500 per project, they believe they don’t stand much to lose financially if it goes wrong. This makes the £15-20/month expenditure on insurance seem pointless.
I understand this line of thinking, but our claims data shows the value of a claim isn’t usually relevant to the fees you’ve received for your work. Other factors need to be considered and this can all add up.
Let’s look at common claims we see at With Jack.
Loss of income from delayed launch
A web designer’s project grows arms and legs. The client has asked for additional pages beyond what was initially quoted, but the web designer does the work for free because they want the client to be happy.
However, this extra work has set the client’s launch expectations behind by 4 weeks. Suddenly they’re annoyed at the money they’ve left on the table by launching later than expected. It’s not your project fee they make a claim for—it’s the 4 weeks of business they deem themselves to have lost.
Extra costs for bringing more hands on deck
A developer underestimates the project scope and gradually falls behind with work. To make sure the client meets their deadline they now need to hire other developers to bring the project up to speed. Because the developer struggled to complete the work on time, they expect them to cover the cost of the additional hires.
Reprint costs due to a typo
A graphic designer creates packaging for a new product but their typo isn’t spotted until the packaging has been printed. A reprint costs a lot more than the project fee, but because the packaging design was the freelancer’s responsibility the client holds them accountable for the reprint costs.
Copyright infringement damages
A copywriter has misused a third-party image in a client’s blog post. The copyright owner asks for damages to be paid since it was used without a license. The figure the copyright owner asks for is entirely up to them, and can often include fees on top of licensing costs.
You can see from these examples the monetary damages your client or third-party demands are often unrelated to what you charge. We haven’t even touched upon the more complex claims where a solicitor is brought in to negotiate on your behalf, which ramps the cost up even more.
It’s not for you to decide what the project is worth to a client, so even if working on ‘small’ projects you will still benefit from getting insured.
