What You Need to Know About Self-Employed Insurance

Every small business owner or entrepreneur needs to be financially prepared to deal with unexpected events or accidents should they happen. It’s why these savvy business people purchase liability insurance.

The same applies to self-employed professionals or solopreneurs who do not work for a company. Instead, they agree to a contract for services, work independently, are free to determine when and for whom they work, and may choose to work for multiple employers or customers simultaneously.

According to the Labour Market Information Council, solo self-employed Canadians (individuals who work independently without employees) account for 73% of all self-employed people. 

These self-employed professionals also need to prepare for the unexpected by having a backup plan to help them recover financially from an accident, mishap, or lawsuit.

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Alarmingly, a Zensurance online poll found that 70% of self-employed Canadians don’t have business insurance. 

Self-employed professionals without insurance face the risk of substantial financial losses from damages and lawsuits, potentially reaching hundreds of thousands of dollars. A single claim could lead to bankruptcy.

What Types of Business Insurance Do Self-Employed Professionals Need?

Determining what types of insurance a policy for self-employed professionals or solopreneurs should have depends on the specifics of what you do. 

However, most self-employed business insurance policies include the following coverages:

General Liability Insurance

General liability insurance is widely purchased coverage for self-employed individuals and small business owners. It helps cover expenses related to third-party bodily injury or property damage caused by accidents at their business or during typical business activities.

Many contacts or companies may only hire you if you provide them with proof that you have a valid policy, usually called a certificate of insurance.

Commercial Property Insurance

No matter where you run your business – whether it’s a home-based business, a storefront, or a rented space – commercial property insurance safeguards what keeps you running: your workspace, equipment, inventory, and electronics. 

It covers losses from fire, water damage, theft, vandalism, natural disasters, and severe weather, such as windstorms and tornadoes.

Professional Liability Insurance

Professional liability insurance, also known as errors and omissions (E&O) insurance, is essential for self-employed professionals who advise clients, provide services, or develop products. 

It protects you if a client suffers a financial loss due to your mistakes, allegations of professional negligence, or failure to deliver as promised. If you are sued, this coverage can pay for your legal costs and any damages awarded to the client.

Commercial Auto Insurance

Self-employed individuals who use a vehicle for business activities such as transporting people, materials, or goods should obtain commercial auto insurance. 

Standard personal car insurance policies usually do not provide coverage for vehicles used for business purposes in the event of an accident.

Additional Types of Insurance for Self-Employed Professionals

Outside of business insurance, self-employed or independent professionals should consider other types of coverage to safeguard their health and long-term wellbeing.

Zensurance does not provide these types of coverages, but it’s worthwhile for self-employed professionals to explore their options for the following:

• Health Insurance: Seek coverage for medical-related expenses, such as prescriptions, visits to doctors and other medical professionals, and hospitalization.

• Dental Insurance: Often overlooked but critical for protecting one’s health, dental insurance pays for routine dental care, such as cleanings, dental examinations, X-rays, fillings, and other procedures.

• Disability or Critical Illness Insurance: This type of coverage reimburses lost income if you’re unable to work and earn as you typically would do to an illness or injury.

• Life Insurance: Supporting your family or dependents financially if you die is what life insurance provides. It typically covers your outstanding debts, funeral costs, and this type of coverage could help support a business succession plan.

• Employment Insurance: The Government of Canada offers employment insurance for self-employed professionals. There are six types of benefits available through this program. Self-employed Canadians that qualify could receive support of up to 55% of their regular earnings when they need time away from their businesses.

5 Ways to Get Low-Cost Self-Employed Business Insurance

Here are five ways to get the self-employed business insurance policy that suits your needs and budget:

1. Ask around

Tap into your network of fellow self-employed professionals, freelancers, and small business owners. Ask who they trust for business insurance and why. 

Then, research and check online reviews to see how those insurers treat their clients when it really counts.

2. Partner with a business insurance broker

Better yet, partner with a pro – having a licensed business insurance broker can be your strategic ally. 

They are trusted advisors who can cut through the jargon, answer your questions clearly, and build a policy tailored to your unique risks.

3. Talk to local industry groups

If you’re part of a Chamber of Commerce, local BIA, or industry group, ask if they’ve partnered with an insurer. These associations may negotiate better rates for their members.

4. Consider your liability risks

Aim for value, not just cost. Ultra-low-cost policies often come with a catch: minimal coverage. If you’re underinsured when disaster strikes, the financial hit can far outweigh the savings you thought you scored.

For instance, if you file a claim for something you don’t have coverage for, it’ll potentially cost you significantly more than an annual premium for a comprehensive insurance package.

5. Choose high deductibles

A deductible is your share of the cost for damage or loss if you file an insurance claim. You can choose your policy’s deductibles; in general, the higher the deductible, the lower the annual premium and vice versa. 

Although a higher deductible might mean a lower premium, it also means more financial responsibility upfront. Make sure your deductible works for your cash flow.

Get a Free Quote for Self-Employed Business Insurance Now

Zensurance specializes in helping Canadian self-employed professionals, solopreneurs, independent contractors, entrepreneurs, and small business owners across Canada get the low-cost business insurance coverage they need. 

Fill out our online application for a free quote. 

Through our partner network, you can access a wide network of over 50 Canadian insurance providers. Our experienced brokers can quickly secure customized insurance coverage tailored to your unique needs.

– Updated June 9, 2025.