As you’re building your virtual assistant business, one of the major things you have to consider is whether or not you should get insurance. Truthfully, many virtual assistants do without it. However, is this the best course of action? In my opinion, absolutely not! Many people forego business insurance because they don’t exactly understand what it is and how it works. Others put it on the back burner because they see it as an unnecessary added expense. Therefore, I’m going to take a moment to explain what business insurance is and its benefits so that you can make an informed decision for your company.
What is Business Insurance?
You know how people get home or car insurance just in case something unexpected happens? They purchase it so that they don’t have to carry the entire financial burden alone if something goes wrong. Instead, they’ll be able to lean on their insurance company to cover some of those costs, which is a huge relief because things can get really expensive.
Business owners purchase business insurance for pretty much the same reason. They don’t want the company they’ve worked hard to build to crumble from a mishap. Therefore, it’s helpful to have something like this in place to protect you and your business from the various risks that exist out there. However, not all business insurance is the same, which is where it can get tricky. For example, some forms of business insurance cover property damage, whereas others may only cover mistakes. So it’s important to know some of the different types to determine what’s best for you.
The Different Types of Business Insurance
There are several types of business insurance out there, but I will focus on the types of insurance virtual assistants should consider.
Commercial Property Insurance
As a virtual assistant, you’ll rely heavily on your computer, phone, and other equipment to do your job. But what happens if you lose your equipment to a fire, burglary, or something else? Commercial property insurance would protect your business’s physical assets by helping you replace those items. Given how expensive electronics can be, getting this insurance might be worth it.
Cyber Liability Insurance
Since you’ll be doing a lot of stuff online, it would help to have some insurance in place if you experience a data breach or cyber attack. For example, many virtual assistants have contact with sensitive material, like their client’s credit card numbers or social security numbers. If you have first-party cyber liability insurance and a hacker steals sensitive information from you, your plan would cover expenses related to the following:
- Paying extortion demands and/or
- Informing your clients about the breach
Third-party cyber liability insurance is an option too. With this type of insurance, you’d be protected if one of your clients blames you for their recent data breach. In addition, the plan would help you with attorney fees, court costs, and more.
General Liability Insurance
This form of insurance is the most popular for businesses. It could protect your virtual assistant company from third-party damages and bodily injury. However, typically, virtual assistants don’t need this type of insurance because they aren’t physically around their clients. Now, if you DO plan on occasionally visiting your client’s home or office, you probably should get this type of insurance. Although it’s pretty unlikely, you don’t want to find yourself in a situation where you drop their laptop or break an expensive vase and don’t have insurance. General liability insurance would help cover legal expenses, and more so you don’t have to foot the entire bill yourself if something happens.
Another thing that general liability insurance is good for is advertising injuries. For instance, if you put out a Facebook Ad that accidentally slanders a competitor, you could be sued for personal and advertising injury. Sometimes it’s unclear what might be considered “harmful,” so having insurance like this helps just in case.
Professional Liability Insurance
One type of insurance that I absolutely, positively do believe that virtual assistants should have is professional liability. You might also hear it go by the name “Errors and Ommissions Insurance.” This covers your behind if you happen to make a work-related mistake. We don’t like to believe we would be negligent when helping clients, but things do happen.
What if a client gives you a task that ends up messing up their reputation? Imagine you’re given an assignment where you overlook something that winds up crippling them financially? What if you fail to deliver the services you were contracted to do? Any of these things could happen, and it’s much better to have insurance just in case it does.
Professional liability insurance lets you sleep a little easier at night, knowing that it’ll help pay for your legal defenses if things go left.
Worker’s Compensation
If you have employees, you’re required by law in most states to have worker’s compensation insurance. This would cover some immediate and ongoing medical costs injured employees might have.
Even if you don’t have employees and it’s not required, it might still be a good idea to have this form of insurance as an independent contractor. For instance, if you sustained an injury that made it impossible to work, they’d help with partial loss of wages. Of course, as a sole proprietor, you’re not required to have this for yourself, but it’s definitely something to think about.
Is Virtual Assistant Insurance Expensive?
Naturally, after reading about all the different types of insurance out there, you’re wondering how expensive it’ll be. To be honest, it depends. The best thing to do is shop around to see what different carriers quote you. I’d recommend getting all of your policies from the same company, as they typically offer a discount when you do.
Whatever you choose to get, evaluate the policies yearly to see if it’s still something you need. Maybe you started off going to clients’ properties in the beginning and decided to pick up general liability. However, maybe you’ve since stopped doing that and don’t need it anymore.
Virtual Assistants, Make Business Insurance A Priority
It’s easy to overlook something like insurance when you’re building your business, but I’m here to remind you that it’s essential to protect yourself. Sure, you might get insurance and never need it, but it’s much better to have it than not. Starting and maintaining a business is already hard work, and it would be devastating to have one event financially cripple you. With insurance, you’ll be able to protect yourself, your clients, and your reputation from the “what ifs.”
Got Questions? Pick My Brain
There’s a lot to learn out here about becoming a virtual assistant, but you don’t have to go at it alone. Purchase a VA Strategy Session to ask me whatever pressing questions you might have about starting or growing your VA business.
