Around  a quarter of all small businesses in the U.S. do not have workers’ compensation coverage, as found in a poll conducted by Insureon. The problem is often a lack of awareness regarding whether or not this type of coverage is required; around 30% of respondents were unsure as to their legal obligations, the poll found. The truth is that the requirement for compensation varies from state to state, with some requiring that businesses take coverage out even if they only have one employee. If  you have a small design business with one or more employees, is workers’ compensation a good idea even if it is only optional for you?

Workers Compensation Covers Unexpected Injuries and Accidents

The design industry is not, per se, a dangerous one, since it mainly involves desk work. However, even if you work from home and contact workers who work in their own home, it is still a possibility for injuries to occur within the course of the person’s job. For instance, they may be injured while carrying computer equipment or suffer a fall while running to answer a work call.  Coverage for remote workers’ accidents and injuries may actually be more important because home design is structured less toward business and features such as staircases, rugs, and ill-placed furniture may result in accidents.  Most workers’ compensation insurance covers everything from ambulance to emergency care to ongoing therapy needs and lost wages so opting for coverage is also a good way to attract and retain talented employees.

What about Legal Insurance?

Legal insurance, unlike workers’ compensation is fully optional but if you want to cover all bases after having invested your savings in your small design business, it may be worth investing in. Attorney fees range from $100 to over $1,000 per hour so taking out coverage may be a very cost-effective way to receive advice regarding design-related matters such as intellectual property and branding. It is also a good idea to have regular contact with lawyers in case another company or a client should sue your business or vice-versa. Legal insurance additionally covers issues such as employee disputes, tax proceedings, commercial tenancy agreements, and the like.

Additional Coverage for Small Businesses

There are  more types of optional coverage you may consider if you have a budget for it. These include data breach insurance, professional liability insurance, and property insurance. The latter is particularly important for those in the design sector, since it covers items such as computers, office equipment, printers, and the like. Should your home or office suffer fire, theft, smoke damage etc., this coverage will ensure you are able to afford replacement of damaged items.
When drafting your budget for your small design business, it is important to factor in insurance costs. Depending on the size and location of your business, some types of coverage (e.g. workers’ compensation) may be obligatory. However, if you can afford them, additional types of insurance — including legal and property insurance — should be considered to enable you to cover all contingencies.

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