Going Freelance Insurance Checklist

Leaving traditional employment for freelance work means losing employer-sponsored benefits. Use this checklist to ensure you have proper insurance coverage as an independent contractor.

Before You Leave Your Job

Understand What You’re Losing

• Review current employer health insurance (coverage ends on termination)
• Check if employer offers COBRA continuation (18 months, but expensive)
• Note any life insurance, disability, or other benefits you’ll lose
• Calculate the true cost of replacing these benefits

Health Insurance Options Research

• Healthcare.gov marketplace (ACA plans with possible subsidies)
• Spouse’s employer plan (if available)
• COBRA continuation (expensive but familiar)
• Freelancer associations and unions (group rates)
• Health sharing ministries (alternative, not traditional insurance)

Timing Considerations

• Job loss is a qualifying life event for ACA enrollment
• You have 60 days to enroll after losing coverage
• Consider timing your departure around open enrollment (Nov-Dec)
• Avoid any gap in health coverage

Essential Freelance Insurance

Health Insurance (Top Priority)

• Research ACA marketplace plans in your state
• Estimate income for subsidy eligibility
• Compare bronze, silver, gold, and platinum plans
• Check if your doctors are in-network
• Consider HSA-eligible high-deductible plan for tax benefits
• Budget: $300-$800+/month for individual coverage

Professional Liability (E&O) Insurance

• Essential for service-based freelancers
• Covers claims of negligence, errors, or poor work
• Some clients require it for contracts
• Costs: $500-$2,000/year depending on profession
• Consider: designers, writers, consultants, developers

General Liability Insurance

• Covers third-party injury or property damage claims
• Important if clients visit your workspace
• Some clients require it for contracts
• Costs: $300-$600/year for basic coverage
• Can often bundle with E&O insurance

Disability Insurance (Often Overlooked)

• Replaces income if illness or injury prevents you from working
• No employer to provide sick leave or disability benefits
• Consider: own-occupation policy for freelancers
• Aim for 60% of gross income coverage
• Buy before health issues arise (pre-existing conditions matter)

Within 30 Days of Going Freelance

Immediate Health Coverage

• Enroll in ACA marketplace plan OR
• Elect COBRA coverage OR
• Join spouse’s employer plan
• Confirm coverage start date (no gaps)
• Set up auto-pay for premiums

Business Insurance Setup

• Get quotes for professional liability insurance
• Consider general liability if meeting clients in person
• Check if homeowners policy covers home office (usually limited)
• Consider business property coverage for equipment

Financial Safety Net

• Build emergency fund (3-6 months of expenses minimum)
• Open business bank account for clear expense tracking
• Research quarterly estimated tax payments
• Consider umbrella insurance for overall liability protection

Ongoing Considerations

Annual Health Insurance Review

• Re-evaluate plans during open enrollment each year
• Update income estimates for subsidy calculations
• Check if your preferred doctors are still in-network
• Consider switching plans if rates increase significantly

Life Insurance Needs

• Term life insurance is affordable and important if you have dependents
• No employer life insurance means you need your own policy
• Get coverage while young and healthy for lowest rates
• Consider 10-20 year term for most freelancers

Retirement Planning

• Open Solo 401(k) or SEP IRA for tax-advantaged retirement savings
• No employer match means you need to save more
• Health insurance costs in retirement should be considered

Home Office Insurance Considerations

Homeowners/Renters Policy Limitations

• Most policies limit business property coverage ($2,500 or less)
• Business liability typically not covered
• Client visits may void home insurance coverage

Options for Home Office Protection

• Add home business endorsement to homeowners policy
• Get separate business owner’s policy (BOP)
• Consider in-home business insurance rider
• Insure valuable equipment (computers, cameras, etc.)

Client Contract Requirements

Common Insurance Requirements

• General liability: $1 million per occurrence
• Professional liability: $1 million minimum
• Sometimes: workers’ comp (even for solo freelancers)
• May need to provide certificate of insurance (COI)

How to Get Certificates of Insurance

• Request from your insurance company (usually free)
• Can often generate online through insurer portal
• May need to add client as “additional insured”
• Allow 24-48 hours for processing

Freelance Insurance Budget Guide

Typical Annual Costs

Budgeting Tips

• Factor insurance costs into your freelance rate
• Consider these costs as part of your “salary”
• Set aside 20-30% of income for taxes and benefits
• Review and shop coverage annually

Common Mistakes to Avoid

• Don’t go without health insurance (medical bankruptcy is real)
• Don’t assume homeowners insurance covers business activities
• Don’t skip disability insurance (your income is your greatest asset)
• Don’t underestimate the cost of replacing employer benefits
• Don’t wait for a client to require insurance to get covered

Related Insurance Types

• Health Insurance - Essential for freelancers
• Disability Insurance - Protect your income
• Business Insurance - Professional liability coverage
• Life Insurance - Protect your dependents

Related Guides

• Insurance for Self-Employed - Complete self-employment coverage guide
• Insurance for Gig Workers - Coverage for independent workers
• HMO vs. PPO Health Plans - Choose your health plan type

Frequently Asked Questions

Common questions about insurance when going freelance answered below.

This checklist is for educational purposes. Consult with a licensed insurance professional for advice specific to your situation.