Do you have a side hustle? The gig economy offers plenty of opportunities for people to generate extra income outside of their full-time jobs, whether driving for companies like Lyft, delivering groceries, freelancing, or even making/ selling goods online.
For many workers, side hustles are motivated by money, plain and simple. 45% of individuals who responded to a series of studies said their top motivation was to increase pay and prestige.
Money's not the only thing driving people to take on side work outside of their regular working hours; 34% of respondents said their top motivation was a desire for variety and autonomy.
Whether you're trying to save up more cash, pay down debt, add variety to your life, or have control over how and when you earn, there's no doubt that a side hustle can get you there. But all of that work can easily be for naught if youâ€™re not putting a safety net in place to help you protect yourself -- and your extra income -- against unexpected accidents, lawsuits, or disasters.
Insurance for Your Side Hustle
Do you really need insurance for your side hustle?
Once you start driving, baking, selling, making, creating, and collecting money, you suddenly face many of the same risks as other business owners -- even if you only gig a few days a week.
- Do you use your vehicle to get work done?
- Do customers or deliveries come to your house?
- Do you process payment or collect personal client information?
- Could someone get hurt or sick as a result of your side hustle?
- Could a professional mistake be detrimental to your clients?
- Would a lawsuit or loss of inventory leave you in financial trouble?
The decorative cookies and cupcakes that you bake for birthday parties are beautiful, creative, and delicious. You get so many recommendations from the local mom's group on Facebook that your weekends are fully booked for the next 3 months straight. In fact, sometimes you have to turn work away, and you're not even paying for advertising!
But all it takes is one allergic reaction to a cupcake -- and subsequent hospitalization -- for a giant bill and nasty attorney letters to arrive at your door.
Or, what happens when you get into a car accident while you're running errands for your side-business? You may not realize it, but personal auto insurance isn't designed to cover you when you're using your automobile for business purposes. Even if that purpose is just driving a bunch of your incredible, hand-made floral headbands to the local post office to mail out to customers.
Not only is this accident not likely to be covered by your personal auto insurance, but it could even lead to policy cancellation.
Creative freelancers who do graphic design, web design, copywriting, or photography aren't without risk, either. What happens when your work leads to business interruption or loss of profit for your clients? If your client's website goes down for two days while you try and fix a coding mistake that crashed the site, and those two days down lead to a loss of online sales, your client could come after YOU for the lost profits.
And anyone who collects or processes payment information or sensitive client information is at risk of being hacked or having a laptop stolen or lost.
Affordable Coverage for Your Side Business
The good news is this:
Insurance coverage for your side hustle or gig work doesn't have to break the bank.
You may even be able to get coverage for a couple of hundred dollars a year, depending on the nature of your side business.
You're working too hard to see your dreams of financial success or creative independence go up in smoke. If you have a side business, talk to an insurance professional who can help you determine what risks you face and what amount of coverage can help you protect your business and your profits.