The way American workers think about work and their relationships with employers has shifted dramatically in recent years. Rather than classifying employment as either full-time or part-time work, there are now a number of overlapping categories and concepts that may not be easy to define. This includes gig work.
Put in the simplest terms, the gig economy refers to that portion of employees who are engaged as independent contractors, freelancers and temporary workers in positions that aren’t defined as permanent. But even that description only goes so far. Gig workers’ roles vary widely, from rideshare driver to graphic artist to adjunct professor – but they all receive income on a 1099 basis (rather than W-2 employment), as defined by the U.S. tax code.
Gig work is sometimes mischaracterized as a “side hustle,” which may imply that it is less important or legitimate than permanent employment. In fact, the gig economy is expanding three times faster than the total U.S. workforce, and the global gig economy generates $204 billion in gross volume. Some gig workers are used in full-time roles, while many more cobble together multiple gigs to clock in 40 hours (or more) every week. And although some employers offer insurance to both their permanent and contract employees, it’s estimated that fewer than half of gig workers are properly insured to cover their work.
What Insurance Is Necessary in the Gig Economy?
Many gig workers don’t know what sort of business insurance they might need (or that they should consider coverage at all), and employers may not warn a contractor of potential risks based on their work. Producers can help bridge that gap by talking to prospective clients about these policies as a starting point:
Liability. Every gig worker should consider themselves a small business owner – whether they are that business’ only employee or they employ dozens of people to contribute to that work. Most traditional personal policies don’t go nearly far enough in protecting a gig worker if someone makes a claim of injury or property damage connected to that work. Business liability insurance can close that gap.
Property. Business personal property insurance covers, say, a writer whose computer is stolen or a small-business spa owner whose furniture is damaged in a flood. Most professionals working in the gig economy lack enough coverage to replace more than a few basic critical business possessions in the event of theft, accident or an act of nature.
How GigBOP® Can Help
Although a basic knowledge of various business insurance policies is helpful for gig workers, determining risk, estimating coverage limits and considering account sizes and other details can be messy for anyone unfamiliar with the process. Navigating the market to track down, compare and price-shop policies is yet another hurdle for contractors and freelancers whose core business has nothing to do with insurance.
A solution to consider: GigBOP® from SynchronoSure. GigBOP® is package insurance specially designed for gig workers and small business owners. Coverage includes business personal property, business liability and miscellaneous professional liability insurance, and is available in all 50 states on an excess and surplus lines (E&S) basis. Gig workers shouldn’t take risks against potential threats to their business and financial well-being – and producers can help: Learn more about SynchronoSure’s GigBOP®, which keeps gig workers covered and provides producers with new opportunities to drive business servicing an untapped market.