Whether you’re a freelance graphic designer, independent construction worker, consultant, or part-time personal trainer, one thing is clear: you’re running a business. And like any business owner, you need insurance that protects your livelihood. As an expert in small business insurance, I’m here to break down the 5 best insurance policies every independent contractor should consider in 2025—plus why skipping coverage could cost you big time.
1. General Liability Insurance
This is the cornerstone of any solid contractor insurance plan. It covers third-party bodily injury, property damage, and personal or advertising injury.
Why You Need It:
Clients often require proof of general liability before signing contracts. It’s your first line of defense against lawsuits—think spilled coffee on a client’s laptop, or damage to a customer’s property while on-site.
Coverage Includes:
- Legal defense fees
- Medical payments
- Settlement costs
Bonus Tip: Always keep an up-to-date Certificate of Insurance (COI) ready for client onboarding.
2. Professional Liability Insurance (Errors & Omissions)
If you provide services or advice—like consulting, coaching, accounting, or design—this coverage protects you from lawsuits over mistakes or missed deadlines.
Real-World Example:
A freelance marketing consultant forgets to launch a campaign that leads to lost revenue. Professional liability covers the legal costs and damages.
Coverage Includes:
- Negligence or error claims
- Misrepresentation
- Breach of contract defense
3. Commercial Auto Insurance
If you drive for business—whether it’s delivering goods, meeting clients, or hauling equipment—your personal auto policy likely won’t cover work-related claims.
Why You Need It:
Auto accidents are among the most common and expensive risks for contractors. Commercial auto policies protect your vehicle, passengers, and others on the road.
4. Tools & Equipment Insurance (Inland Marine Insurance)
Your tools are your livelihood. This policy covers theft, loss, or damage of tools—even while in transit or on a job site.
Industries That Need It:
- Construction
- Photography
- Landscaping
- Mobile beauty services
Pro Tip: Bundling this with general liability can often save you money.
5. Business Owner’s Policy (BOP)
This is a customizable bundle that typically includes general liability, commercial property insurance, and business interruption coverage—ideal for independent contractors with office space or valuable inventory.
Why It’s Smart:
It’s a one-stop-shop for multiple essential coverages and usually more affordable than purchasing each policy separately.
Why Insurance Matters More in 2025
More clients are requiring independent contractors to carry specific types of insurance before they’ll sign a contract. If you’re not covered, you could:
- Lose out on lucrative work
- Be held personally liable in a lawsuit
- Damage your professional reputation
Contractor insurance doesn’t just protect you—it opens doors.
Get Covered in Minutes
At Bunker, we make it simple for independent contractors to:
✅ Get insured online in minutes
✅ Download instant Certificates of Insurance
✅ Add endorsements for client-specific contracts
✅ Only pay for what you need—no fluff
If you’re interested in learning more please visit buildbunker.com or contact us at support@buildbunker.com!
