Affordable Insurance Options for 1099 Freelancers in 2025

Freelancing offers freedom—but that freedom comes with responsibility. As a 1099 contractor, you’re not just a worker; you’re a business owner. That means you’re also responsible for covering your own insurance needs—from liability to health to property coverage.

And while many freelancers assume insurance is too expensive, the reality is this: there are affordable, tailored insurance solutions designed specifically for independent contractors like you.

In this blog, I’ll share the top budget-friendly insurance options for 1099 freelancers in 2025, explain why they matter, and show you how to protect your income, reputation, and future without overspending.

💼 Why Freelancers Still Need Business Insurance

It’s tempting to think: “I work from home, I don’t need insurance.” But even digital-first freelancers can face:

• Client lawsuits over missed deadlines or project errors 
• Injuries that prevent them from working 
• Cyberattacks or data loss 
• Equipment damage or theft 
• Client contract requirements for proof of insurance 

Without coverage, one unexpected issue could wipe out your hard-earned income or damage your professional credibility.

💡 The Top Affordable Insurance Options for Freelancers

1. Professional Liability Insurance (Errors & Omissions)

Average cost: $25–$60/month
Protects you from lawsuits if a client claims you made a mistake, gave bad advice, or failed to deliver.

✅ Essential for: Writers, consultants, designers, coaches, marketers, editors, developers.

Pro tip: Choose a plan with a deductible you can afford. Even basic coverage can save you thousands in legal fees.

2. General Liability Insurance

Average cost: $20–$50/month
Covers third-party bodily injury, property damage, or legal defense costs if you’re sued for causing harm during business activities.

✅ Essential for: Freelancers who meet clients in person, use shared workspaces, or work on-site.

Pro tip: Combine this with professional liability in a bundled policy to reduce your premium.

3. Business Owner’s Policy (BOP)

Average cost: $40–$75/month
A bundle that includes general liability + commercial property insurance (and sometimes business interruption insurance).

✅ Essential for: Freelancers with home offices, equipment, or physical inventory.

Pro tip: Ask your insurer about customizing your BOP to avoid paying for coverage you don’t need.

4. Cyber Liability Insurance

Average cost: $15–$40/month
Covers costs related to data breaches, cyberattacks, or compromised client information.

✅ Essential for: Any freelancer who handles client data, operates online stores, or uses digital systems.

Pro tip: Some BOPs now offer cyber endorsements at a lower rate than a standalone policy.

5. Health Insurance for Freelancers

Affordable access options:

• HealthCare.gov (Marketplace subsidies available based on income) 
• Freelancers Union (group plans) 
• Association-based plans (e.g., through local chambers or trade organizations) 

✅ Essential for: Everyone. One health emergency without coverage can set you back years financially.

Pro tip: If you’re on a tight budget, look into High Deductible Health Plans (HDHPs) with an HSA (Health Savings Account) for tax benefits.

🧾 Bonus: These Policies Are Tax-Deductible

Most freelancers don’t realize that insurance premiums are deductible business expenses under IRS guidelines. That means:

• Your professional liability, general liability, cyber, and even part of your health insurance may reduce your taxable income. 
• A smart insurance plan protects your business and your bottom line. 

🎯 How to Shop Smart for Freelancer Insurance

• Compare Quotes: Use freelancer-friendly providers that specialize in 1099 coverage. 
• Bundle Policies: Get discounts by combining liability, property, and cyber coverage. 
• Pay Annually: You’ll often get a lower total premium by paying once per year instead of monthly. 
• Work with a Specialist: Insurance companies that understand freelancers (like us!) can tailor affordable options based on your exact risk profile. 

🔐 Affordable Doesn’t Mean Inadequate

You don’t need to spend a fortune to stay protected. The key is finding the right balance between coverage and cost based on your type of work, income level, and client exposure.

At Bunker, we specialize in creating insurance packages built for 1099 workers—so you get exactly what you need, and nothing you don’t. If you’re interested in learning more please visit buildbunker.com or contact us at support@buildbunker.com!