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Kingsbridge insurance

‘Self employed’ insurance: What is it and why it matters

Why self employed professionals may want to consider insurance

‘Self employed’ insurance refers to a package of business cover created for people who work for themselves, including contractors, freelancers, consultants, and sole traders. These policies are designed to help protect against common risks like client disputes, accidents, or claims made against your business.

Self employment offers freedom and flexibility – but it also brings responsibility. Unlike employees, you don’t have the safety net of sick pay, an HR department, or an employer’s insurance policy in the background. If a mistake, accident, or claim happens, the financial risk often falls on you.

Having self employed insurance in place may help protect your livelihood, reassure clients, and keep your business moving. Many contracts also expect proof of cover before work begins, so holding insurance could make the difference when securing new opportunities and building professional credibility.

Get your ‘self employed’ insurance quote

Is self employed insurance legally required?

Not every policy is compulsory, but some types of cover are a legal requirement in the UK:

Employers’ liability insurance – required if you employ staff, even part time or family members. The law requires a minimum of £5 million cover.
Motor insurance – if you use a vehicle for business purposes, your policy must include business use. This addition is arranged through your motor insurance provider rather than through a typical business insurance package, as business use is not usually included by default.

Other covers, like professional indemnity or public liability, aren’t required by law but are frequently requested in client contracts. Holding this type of cover can demonstrate that you take your responsibilities seriously and may help you secure new work.

What insurance do I need if I’m self employed?

The cover you may need depends on your profession, how you work, and the risks you face. Some of the most common types include:

Professional indemnity insurance

Professional indemnity (PI) insurance is designed to help with claims relating to professional errors, negligence, or breach of duty if a client alleges financial loss. Many contracts require PI cover, especially in sectors like consulting, IT, engineering, and design. Even the most careful professionals can face disputes, and having protection in place may help you manage those risks.

Note (general): PI policies are typically written on a claims made basis, which means claims (or circumstances) must be notified during the period of insurance. Limits, retroactive dates and excesses are shown on the policy schedule.

Public liability insurance

Public liability insurance typically covers claims from third parties for injury or property damage linked to your work. While not a legal requirement, it’s one of the most widely held policies among sole traders and small businesses. Even a small accident could result in costly legal fees or compensation payments, which can be difficult to absorb if you’re self employed.

Employers’ liability insurance

If you employ anyone – even on a part time or temporary basis – you’re usually required by law to hold employers’ liability insurance. This policy is designed to cover claims made by employees who have been injured or become ill as a result of their work while employed by you. Failing to have cover when required can result in significant fines.

Occupational personal accident cover

Unlike employees, the self employed don’t receive statutory sick pay. Occupational personal accident cover is designed to support you financially if you have an accident that prevents you from working. It provides a weekly payment for a set period or a lump sum if the injury results in permanent disablement.

Note (general): Personal accident cover applies to accidents (not general illness). Weekly benefits, lump sum limits, deferment periods and any occupation/load related adjustments are set out in the policy schedule.

Tools and equipment insurance

Your tools or equipment are often the backbone of your business. Tools and equipment insurance is designed to cover items if they’re lost, stolen, or damaged, whether at home, on site, or while travelling. Without this cover, you may be left paying out of your own pocket to replace vital kit.

Note (general): Policies commonly require evidence of forced or violent entry for theft claims, and specific security conditions may apply (e.g., locked vehicles, fixed locked toolboxes for open cargo areas). Limits, excesses and item sub limits are shown on the schedule.

Cyber liability insurance

As more self employed professionals work online, cyber liability insurance is becoming increasingly relevant. This type of policy is designed to help with the costs of data breaches, hacking incidents, or cybercrime. If you hold sensitive client data or work with digital systems, it could provide an important safety net.

Directors’ and officers’ liability insurance

If you’re a director of your own limited company, you may want to consider directors’ and officers’ liability insurance. It’s designed to help with defence costs if you’re accused of mismanagement, breach of company law, or regulatory failure.

Self employed income protection and sickness cover

Many self employed professionals search for terms like “self employed insurance if I can’t work” or “self employed insurance for sickness”. These concerns are very real: being unable to work due to injury or illness can have an immediate impact on your income.

Income protection products, like personal accident cover, are designed to provide weekly payments for a set period of time or a lump sum for permanent disablement. This type of cover may help you continue meeting financial commitments while you focus on recovery.

How much does self employed insurance cost?

The cost of ‘self employed’ insurance depends on several factors:

The type of work you do, and the risks involved
The level of cover you choose (higher cover limits usually cost more)
Whether you employ staff
Your previous claims history

For some sole traders, public liability insurance may start from less than £10 per month, but premiums will vary based on your situation. While many people search for “cheapest self employed insurance”, it’s worth remembering that the lowest cost policy may not always provide the coverage you need.

Balancing affordability with adequate protection is often more sustainable in the long term.

What is the best ‘self employed’ insurance?

There’s no single answer to what the “best” insurance is, because it depends on your trade, clients, and risks. For example:

Consultants may find professional indemnity and cyber liability particularly relevant
Tradespeople and builders often look for public liability, personal accident, and tools cover
IT contractors may focus on PI, public liability, and cyber cover
Freelancers working from home may consider PI, public liability, and business equipment cover

A package policy that combines these covers into one can simplify administration and help avoid gaps in protection.

How does insurance work for the self employed?

Insurance works by transferring some of your financial risk to an insurer. In return for a premium, your insurer may cover certain claims or losses if they fall within the policy terms. This might include covering the costs of legal defence fees, compensation, or to repair or replace essential tools and equipment.

Having insurance in place may also demonstrate professionalism to clients. Many contracts, especially in consulting and contracting, require proof of cover before you can begin work.

Why choose Kingsbridge?

At Kingsbridge, we provide specialist Contractor Insurance suitable for contractors, freelancers, and the self employed. Our package typically combines the key covers most professionals need into one policy:

Professional Indemnity Insurance (claims made; limits/excesses per schedule)
Public Liability Insurance (limits/excesses per schedule)
Employers’ Liability Insurance (required if you employ staff; occurrence based)
Personal Accident cover (weekly benefits up to a set period or lump sum for permanent disablement; terms per schedule)
Directors’ and Officers’ Liability (for limited company directors; limits/excesses per schedule)

Optional extras such as Cyber Liability and higher Tools cover can be added to suit how you work. Where Tools cover is selected, theft claims usually require forced/violent entry and compliance with policy security conditions (e.g., locked vehicles, keys removed; fixed locked toolboxes for open cargo areas). All cover sections, limits, sub limits, excesses and endorsements are confirmed on your policy schedule.

Our Price Promise means if you find equivalent cover cheaper elsewhere, we’ll beat it. That way, you can be confident you’re getting competitive protection designed for the self employed.

Get your Kingsbridge quote

‘Self employed’ insurance FAQs

How much does self employed insurance cost in the UK?

The cost of self employed insurance depends on factors such as your trade, the type and level of cover you choose, and whether you employ anyone. Entry level packages may start from under £10 a month, but prices vary depending on how much protection you need.

Most self employed professionals opt for a package policy that combines several key covers – such as professional indemnity, public liability, employers’ liability, and personal accident cover – for broader protection and better value.
What is income protection insurance for the self employed?

Income protection insurance is a separate product designed to replace a portion of your income if you’re unable to work due to illness or injury.

Kingsbridge does not provide income protection insurance, but our personal accident cover offers similar short term financial support following an accident. It provides weekly benefits for a set period, or a lump sum payment if an accident results in permanent disablement. Specific benefit levels, deferment periods and any occupation based adjustments are set out in the policy schedule.
Do self employed people need public liability insurance?

Public liability insurance isn’t a legal requirement, but it’s often requested in client contracts and is one of the most widely held covers among sole traders. It’s designed to help with third party injury or property damage claims, which can be costly to defend. Having public liability cover in place may also make you more attractive to potential clients.
What is the best insurance for self employed professionals?

The best insurance is the one that reflects your profession and risks. For example, consultants may focus on professional indemnity, while tradespeople may prioritise public liability and tools cover. IT contractors often consider cyber liability alongside core covers.

Many self employed professionals opt for package policies that combine multiple types of cover for simplicity and breadth.
Is business insurance mandatory for self employed people?

The only type of business insurance that is usually mandatory is employers’ liability – and only if you employ staff. However, contracts may require you to hold other types of cover, like professional indemnity or public liability. Even when not compulsory, these policies may help reduce your financial risk and strengthen your professional standing.
How can self employed insurance help with sickness or loss of earnings?

If you can’t work due to injury from an accident, cover that includes personal accident is designed to provide financial support. This may take the form of weekly payments or a lump sum, depending on the policy. Such cover may help you keep up with living costs and other commitments while you recover.

(General sickness/illness is not covered under personal accident.)
Does being self employed make insurance more expensive?

The cost of insurance is influenced more by the type of work you do than by your employment status. A freelance designer working from home may pay relatively little for cover, while a self employed builder could face higher premiums because of the risks associated with construction work.

What matters most is making sure your insurance reflects the risks specific to your business.

Get your ‘self employed’ insurance today

Running your own business means you take on your own risks, but the right cover can help lighten the load. ‘Self employed’ insurance is designed to give you financial protection when unexpected events arise, provide reassurance to clients, and help you focus on growing your business with confidence.

At Kingsbridge, we understand the challenges faced by contractors, freelancers, and sole traders. That’s why our package combines the key covers most self employed professionals may need into one simple policy, with the option to add extras like Cyber Liability and Goods & Tools cover – so you can build a solution that reflects the way you work.

You can get a tailored quote online in minutes. If you’d like more information about what is included in our package or help finding the right insurance for your business, our in house team is on hand to help – you can reach them on 01242 808740.