The modern workforce is increasingly freelance. Whether you’re hiring a software developer, marketer, photographer, or consultant, 1099 contractors play a vital role in your business operations. But here’s a common mistake we see hiring firms make every day: they onboard freelancers before verifying proper insurance coverage—leaving themselves exposed to financial, legal, and compliance risks.

At Bunker Insurance, we help businesses avoid that mistake by simplifying contractor insurance compliance. Below, we’ll walk you through how to properly vet freelancers for insurance coverage before signing a contract, what to look for in their Certificates of Insurance (COIs), and how to stay compliant without the administrative headache.

Why Insurance Coverage for Freelancers Matters

Hiring a freelancer isn’t just a one-off engagement—it’s a transfer of operational risk. Freelancers often:

Enter your workplace
Interact with customers
Access internal systems or data
Deliver services that carry liability exposure

If something goes wrong, your company could be held liable—especially if there’s no proof of insurance coverage in place.

That’s why many firms today require 1099 contractors to carry active insurance policies such as:

General Liability
Professional Liability (Errors & Omissions)
Cyber Liability
Workers’ Compensation (in some states or roles)

Step-by-Step: How to Vet Freelancers for Insurance Coverage

✅ Step 1: Define Your Insurance Requirements in Advance

Before posting a job or engaging a freelancer, determine the types of coverage required based on the contractor’s role and exposure. For example:

A web developer may need Professional Liability + Cyber Liability
A handyman or event contractor likely needs General Liability + Workers’ Comp
A consultant should carry Professional Liability + General Liability

At buildbunker.com, we offer coverage tailored to freelancer roles, helping contractors get compliant fast—and helping you collect exactly what you need.

✅ Step 2: Request a Certificate of Insurance (COI)

A COI is the industry-standard document that proves coverage. Request it before signing the contract. It should include:

Contractor’s name (matching the contract)
Policy type and carrier
Coverage limits (check if they meet your minimums)
Active policy dates (watch for expiration)
Your business listed as the Certificate Holder

Bonus: Some businesses request to be added as an Additional Insured to gain extended protection on the freelancer’s policy.

✅ Step 3: Verify the COI

Here’s where many companies get tripped up—they receive the COI and file it away without checking for red flags. Be sure to:

Match names to ensure the contractor and policyholder are the same
Check expiration dates to ensure the policy won’t lapse mid-project
Confirm coverage limits match your risk threshold (e.g. $1M per occurrence is standard for General Liability)
Look for exclusions that may void coverage for specific services

Not sure what you’re looking at? Bunker’s COI verification tools do the hard work for you, ensuring authenticity and compliance from day one.

✅ Step 4: Use a Contract Template with Insurance Language

Your contract should clearly spell out:

Which coverages the contractor must carry
Minimum policy limits
When and how to provide updated COIs
Your right to terminate the agreement if coverage lapses

Don’t rely on vague agreements. Risk transfer is only enforceable if it’s documented—and that includes insurance clauses.

Pro Tip: Send Freelancers to Bunker for Fast Coverage

If a great freelancer doesn’t have insurance, don’t panic. Just send them to buildbunker.com. We help independent contractors:

Get instant coverage tailored to their role
Generate downloadable, shareable COIs
Avoid costly gaps or mismatches

Your freelancer stays protected. You stay compliant. Everyone wins.

The Bottom Line

Freelancers bring agility and innovation to your team—but without insurance coverage, they also bring risk. By implementing a simple vetting process, you’ll protect your company’s reputation, finances, and legal standing before the first deliverable is even submitted.

Need help simplifying contractor insurance vetting and compliance?
Let Bunker Insurance take it off your plate: buildbunker.com