After businesses shuttered and U.S. workers were sent home at the height of the pandemic in 2020, a report from Dollar Sprout revealed that more that 27% of those with a side hustle rely on that income to pay their bills.
They might be doing anything from tutoring, freelance writing, offering professional consulting services, walking dogs or delivering groceries—to name a few. The Dollar Sprout report also revealed that:
- Of those with a side hustle, 18% expect to turn it into a full-time source of income.
- Although 23% lost side-hustle income because of COVID-19, 42% remain hopeful about their prospects.
While the pandemic reshaped the workplace, the prevalence of home-based businesses had already given rise to Etsy, the fourth largest U.S. ecommerce site by monthly visits, where people sell everything from crafts and antiques to handmade toys and items for weddings, among other things.
As individuals take on side hustles to generate more income or out of a desire to operate their own businesses, they also take on risks. If you have a side hustle, you need to insure yourself accordingly.
Liability Insurance
Liability insurance tops the list. Your insurance agent can help you evaluate your side business, assess your existing coverages, and determine if you need a professional or business liability policy in addition to personal insurance
Why is this so important? Even the most benign gig could destroy an individual financially in the absence of appropriate insurance coverage. Imagine a child takes a nasty tumble in your home while there for a piano lesson or a client accuses you of plagiarism: You will be liable. Or consider the costs you would be responsible for if the dog you’re walking breaks loose and attacks a pedestrian. The right policy can protect you.
Cyber Insurance
Cyber insurance is also a growing consideration. If you set up an online store to sell crafts or homemade baked goods and a hacker steals your customers’ credit card data, what would be the cost to you? Would you be able to recoup your losses? Cyber insurance can protect you in the event of a breach whether your computer is hacked or your phone containing private information is stolen.
Commercial Auto Insurance
Some auto insurance policies are for personal use only. Others may cover a business-related accident, but with limited coverage. If your side hustle involves driving and you get into an accident, do you know whether your insurance will cover you? If not, check with your insurance agent before an accident occurs. Even if you are employed as a delivery driver, you need to know whether the company’s insurance covers you and what the limits are for collision, liability and medical.
Fire Insurance
You probably have a homeowners or renters insurance policy that provides coverage for losses incurred in a fire. But what happens if you operate a home business and spent thousands of dollars on office equipment? Will the insurance extend beyond your personal belongings to cover that equipment? Or, for that matter, will it cover the materials you purchased to make the items that you sell, or the business inventory you store at home? Find answers before you need to make a claim, and avoid potentially devastating surprises.
Workers’ Compensation
As your business grows, be sure to inform your insurance agent so they can work with you to adjust your coverages and ensure the policies keep pace with your needs—especially if you hire workers or engage a contractor. Your agent can advise you about workers’ compensation insurance and employment practices liability insurance.
Think of Garden State Central Insurance as a business partner who has your interests at heart. We’ll work with you every step of the way as you grow your side hustle and reap the fruits of your efforts. Get in touch with us for a policy review and quote.