Independent Contractors Risk All Without the Right Coverage

More companies are outsourcing jobs to freelancers or independent contractors (ICs). According to the Bureau of Labor statistics, the number of freelancers and ICs has grown dramatically in the last few years and is expected to continue rising.

Many freelancers and ICs themselves have failed to keep up with the times; these days you need commercial insurance more than ever, but few realize that without it, they’re setting themselves up for big risks. Contractors and freelancers essentially share the same risks as small businesses. Consider yourself a type of small business, and protect yourself as such.

As soon as you start freelancing or work as an IC, you need insurance. Essentially, every freelancer and independent contractor needs professional liability insurance, even sole proprietors, such as writers or accountants. Depending on your job, you may need other types of commercial insurance as well.

Freelancers and ICs are often considered experts. Most projects involve working for another business or individual, meaning that if a business loss results from a project done by an IC, he or she is financially liable for that loss and other resulting damages.

Several types of commercial liability policies are available for both ICs and freelancers, although what is needed depends on your line of work, job functions, and other factors (such as whether you see customers at your own place of business or drive a vehicle solely for work). These factors help determine what coverage is needed.

Types of insurance:

  • Professional Liability Insurance:
    Often referred to as professional indemnity insurance, and sometimes as independent contractor liability insurance, this policy protects against possible claims from clients, such as a costly mistake that the contractor may be liable for. It provides liability coverage in different amounts, and helps cover costs of liability claims should the claimant prove contractor liability.
  • Product Liability Insurance:
    If you create products or items others will use, purchasing product liability insurance is a must. For example, a freelance computer software consultant is hired by a company to build software programs for them. Shortly thereafter, the software crashes, deleting all the information in the company’s database and potentially leading to multiple lawsuits on a number of grounds.
  • Cyber Liability Insurance:
    Cyber liability essentially provides protection against losses related to electronic storage – something not usually covered under regular commercial policies. This protects you if one of your clients and/or the client’s customers experience losses due to unintentional or purposeful negligence on your part.

For example, a freelance computer software developer builds a database for a company that stores sensitive, personal information on their customers. It’s hacked, and a customer’s identity is stolen. The customer could sue the company, and the company could, in turn, sue the freelancer for a number of things, such as loss of business, costs of obtaining new databases and security features, and more.

If you’re an IC or freelancer, discuss liability policies, as well as commercial auto insurance, physical premises liability, and other types of coverages with your agent, for your own peace of mind.

INSURANCE
Home Childcare Providers Need a Commercial Policy

In the U.S., there are more than 280,000 regulated “home daycares” (also known as “family daycares”) that are run out of residences. It seems that in-home daycare is a popular choice for parents . . . and a booming business. Whether you operate a daycare center or simply provide childcare for family or friends, if you receive compensation for it, the operation becomes commercial, with the attendant risks and legal concerns. All childcare providers are potential lawsuit targets, so at minimum, you’ll need liability protection. Here are some facts you should be aware of:

Homeowners insurance: As of 1991, homeowners insurance excludes liability protection related to home-based commercial activities. Furthermore, the majority of homeowners insurance policies specifically exclude liability coverage for claims arising from home childcare businesses. Homeowners insurance endorsements may provide limited protection, but few insurers offer it. When it is available, it’s often restricted, limiting you to the care of three or four.

Coverage: Business liability insurance is the best choice. There are a range of commercial childcare policies, many offering protection for professional liability claims, which homeowners insurance endorsements don’t cover. These policies differ greatly in coverage and exclusions. Usually, there are exclusions for claims dealing with the administration of medicine, field trips, transportation, pets, or “attractive nuisances,” such as pools or trampolines.

As for liability limits, you should have at least $1 million of coverage on a per-claim occurrence.


MARKETING
All You Need to go Viral is Good Timing and a Piano-Playing Cat

Piano CatIn planning a new ad campaign, you probably think its success depends on your content. So, whatever your product or service or cause, you get busy assembling the key points (aka: the content).

You choose content so strong and so persuasive that you know it will blow their socks off. You have it produced by a pro, and it’s great! But nothing happens. Nobody cares.

Wonder why your fabulous spot didn’t go viral?

Current research tells us that 60 percent of B2B businesses will increase their content marketing this year, and of those, only 6 percent will achieve 100,000 viewers. Fewer than 1 percent will reach a million. The reason is simple: Content isn’t engaging; emotional appeal is.

According to Lauren Covello, who wrote, “What the ALS Ice Bucket Challenge Can Teach us About Content Marketing,” we can learn three things from that spectacularly successful challenge:

  • “People like to interact with people, not organizations.”
  • “People are just as likely to act when you make them laugh.”
  • “The call to action is fun and free.”

As Veronica Maria Jarski, senior writer with MarketingProfs, notes in her infographic on going viral: “Content that arouses curiosity, amazement, astonishment, uncertainty, humor, and admiration has a greater chance of going viral. Negative emotions do not inspire sharing.”

Jarski suggests other things you can watch out for: timing the release of your video when people are looking for it (not on weekends), and ensuring it’s well designed.

So, in your next campaign, while you’re assembling content for a dynamite video you hope will reach millions, it might be smart to release your well-designed video on Wednesday and integrate the content with a sure winner…like a piano-playing cat.


ENTREPRENEURS
Multitasking. No One Likes it. Mistakes Happen. Why do it?

JugglerSociety wants us to multitask. So we do. And no one multitasks like the average small business owner, not because it’s enjoyable or even because it’s something he or she excels at, but because – let’s face it – who else will?

Do we (and our companies) benefit from our multitasking? And does it matter?

It matters. A Huffington Post infographic entitled, “The High Cost of Multitasking,” suggests that multitaskers make up to 50 percent more errors: “According to 2013 estimates, trying to do too many things at once costs the global economy $450 billion annually.”

David Strayer, a University of Utah researcher into attention and performance, also found that multitasking leads to diminished performance. He postulated that the human brain is not wired to do two things at once.

Indeed, a recent New Yorker article reported that when Strayer and his colleagues observed thousands of drivers approaching a stop sign, they found that those using their cell phones were twice as likely to go through the stop.

Strayer wanted to know more, so he and Jason Watson, a cognitive neuroscientist, set up a series of experiments. For most subjects, the more tasks they had to complete, the worse the performance. With this exception…

Two percent of the population actually performed better when multitasking. Further testing demonstrated that the neural architecture of these “supertaskers” is simply different than the rest of us.

So, unless you are in that lucky 2 percent, stop trying to be all things to all people, and focus.


 

December 4th, 2014 by Lightship Insurance