Working alone can have its benefits. A tea round for one takes no time at all, for example.

When things go wrong, however, it can be a lonely and worrying time. It’s down to you alone to put right any problems with your work, and placate unhappy customers.

It may not be top of your list when building a freelance business but if you’re not prepared for potential mishaps, it could end your business in a heartbeat.

A wedding photographer, for example, could face allegations from a client that he didn’t take the range or amount of photos agreed beforehand. In an extreme case, the couple could insist the photographer pays to recreate their wedding and take more photographs. Should this dispute be unresolved and the client claims your mistake has left them out of pocket, you’ll need to pay a solicitor to defend you. If it turns out you are in the wrong, you’ll need to pay the client plus additional costs. To ensure that you’re prepared and covered, we’ve asked PolicyBee, a leading insurance provider, to give us their top tips on staying out of trouble and in pocket.

  1. Use clearly worded contracts

These should set out exactly what’s going to happen, and when. As well as outlining what you’ll do for your customer, the contract should say what you expect of them, too (for example, your payment terms). Make sure your client signs it, to show they accept. This proves, in writing, that you have an agreement – if there’s a claim, it’s very difficult for your insurer to defend you without this.

  1. Be transparent

All communication with your client should be clear and easy to understand. Be honest, and let your client know early if you think there might be a problem or a delay with your work. Make it easy for your client to access project documents so they always feel involved. It’s their money after all.

  1. Only use subcontractors with their own professional indemnity insurance

Since your client’s contract is with you, they’ll turn to you if things go wrong. That can cause problems if you didn’t do the work and someone else did. If your subcontractor doesn’t have PI insurance (so their insurer deals with it), you’ll have to sort out the problem yourself. And that’ll cost time and money.

  1. Use third party media with caution

This should be second nature to a freelancer in a creative industry, but it’s worth mentioning anyway. Always get the right licenses when using third party media (images, video, audio). Use it without permission, and the creator could sue you for intellectual property infringement.

  1. Get written sign off from your client

Solicitors widely agree that once a client has signed off a piece of work, they take final responsibility for it. That includes any errors that sneak in unnoticed. Get it in writing, though, or your insurer can’t use it to defend you.

  1. Beware late payers

Dragging heels around paying invoices could be a sign of a dissatisfied customer. Tread carefully: try to figure out what the problem is, and resolve it if possible. Most of the time, it’s probably just an honest mistake. If your customer continues to refuse payment, it’s time to notify your insurer or broker about a potential claim.

7.    Get Covered

Insurance covers more than just stolen kit. Professional indemnity insurance is designed to cover you when things go wrong and a client makes a claim. It can cover legal costs and clients costs in many cases. However, just because you’ve got Professional Indemnity, doesn’t make you Superman. Professional indemnity is a great way to protect your business, but think of it as your ‘backup parachute’. You shouldn’t intend to use it – it’s there just in case.


Safety in numbers

If you’re looking to protect your business, these six tips and some decent PI insurance are good places to start. In fact, most insurers will want to know you do things like this to minimise your chances of a claim.

If in doubt, your insurer or broker will be happy to answer any questions you have about your insurance. They’re always the first people you should get in touch with if you think you have a claim. Remember: it’s better to be safe than sorry.

We’re PolicyBee: a professional insurance broker, specialising in cover for small businesses and freelancers. We’re offering £20 off business insurance to Freelancer Club members, so get in touch to see how we can help. Click to get the deal.

Photograph: 'Studio Desks: Eric Benoit' by Juhan Sonin