Why do web designers need insurance?
Legal and copyright issues
Web designers often work with licensed content, such as images, videos, and other multimedia elements, which can sometimes result in copyright infringement and financial penalties.
Financial demands stemming from client dissatisfaction
Project delays, scope creep, and client dissatisfaction are common in the creative industry. Occasionally, disputes can lead to refund demands or legal actions.
Accusations of making a costly mistake
Your client may accuse and demand financial compensation if, following your work, sales drop, the website stops performing or stops working altogether.
Unpaid invoices
More often than not web designers have to deal with bad debt. Clients either unduly delay payments or try to wriggle out of paying altogether.
Professional indemnity insurance for web designers
Professional indemnity insurance protects web designers from accusations of professional mistakes, negligence, copyright infringement and other claims against you or your business.
Given the potential exposures web designers can face, professional indemnity can be very affordable compared to the possible costs if you need to defend yourself.
What does web designer professional indemnity insurance cover?
Professional indemnity insurance protects web designers from claims or accusations of wrongdoing from their professional advice or work product.
Cover includes:
- Failing your duty of care
- Making a mistake
- Acting negligently
- Giving the wrong advice or recommendation
For example, a client demands compensation because they believe:
- Their site, which you redeveloped, went wrong, causing significant brand damage
- Your work resulted in a loss of traffic, drop in sales or broken functionality
- Due to your work, they’re in breach of copyright or data protection rules
Suited PI cover will provide you with immediate access to an experienced legal team who will review a developing situation with an unhappy client and advise you on what to do next or take over if appropriate.
What professional indemnity limit do web designers need?
You should consider several factors when deciding on a professional indemnity limit.
Factors to keep in mind:
- Does your contract specify professional indemnity up to a specific limit?
- Does your contract state you agree to be liable for damages up to a certain amount (e.g. £1,000,000)?
- What is the total value of your client contracts over the last few years?
- What costs might you be exposed to if your work goes wrong?
- What might it cost your client if you can’t deliver on time?
- Do you play a senior role in the delivery of work?
Does professional indemnity insurance cover my web designing activities worldwide?
Your professional indemnity policy's ‘territory or geographical limits’ and ‘jurisdiction’ sections specify if your web designer insurance will respond when working in different countries.
Territory or geographical limits:
The territory or geographical limit specifies where you can virtually or physically deliver your services. For example: “Worldwide.”
Jurisdictional limit:
The jurisdictional limit specifies which legal jurisdictions your policy will defend you if you are sued. For example: “Worldwide excluding US and Canada.”
Contract governance:
Any contracts or agreements you enter into with your clients should specify the ‘governing law’ for that contract, which is the jurisdiction in which parties can seek legal remedy for breach of contract.
Avoid entering contracts not governed by your local jurisdiction and/or excluded by your web designer professional indemnity insurance.
If you work with US and Canadian clients, you can reduce your risk by not entering contracts governed by US and Canadian laws.
Switching your professional indemnity insurance
Typically, in the UK, if you cancel a professional indemnity policy, you can no longer claim against it.
Therefore, if you switch your web designer insurance provider, be sure your new policy covers your past work; this is called “retroactive cover”.
Should I keep professional indemnity insurance if I pause my web design business?
It’s wise to keep your professional indemnity if you’re taking a break or retiring from web designing. Claims against professional misconduct can surface months or years after you delivered the work.
Remember: If you cancel your policy, your insurance coverage will end, including coverage for any previous work.
How long you keep your cover in place is up to you. Consider the type of web design work you did and the likelihood that a client might bring a claim against you.
Public liability insurance for web designers
Public liability insurance shields web designers from claims of injuries or property damage.
If you have any kind of face-to-face contact with your clients and the public during your business, then there is a risk of third-party injury or property damage. Something as small as spilling your flat white over a client’s laptop can set you back a few thousand pounds.
Public liability is an inexpensive protection against unfortunate incidents such as slips, falls, or you causing damage to a third party’s computer equipment.
What does web designer public liability insurance cover?
Public liability insurance is valuable when faced with injury claims and compensation demands.
Cover includes:
- accidental injury or death
- accidental property damage
For example:
- A client visits your premises and is injured in a slip or fall
- You visit a client site and damage equipment by knocking over a coffee
Other insurance web designers buy
The insurance necessary for your website design business will vary based on your specific situation. Consider if you could handle a legal conflict, the impact of negative publicity on your reputation, your reliance on costly computer equipment, and how you would manage your business expenses if you became ill.
Commercial legal expenses insurance
Most commercial legal expenses insurance will protect web designers against various tax and legal issues you may encounter due to your profession, which are not covered by professional indemnity or public liability.
At Suited, we combined £100,000 of commercial legal expenses insurance with helplines and other tools to better assist web designers in dealing with these issues. We call this Business Legal Protect, and it’s part of your subscription.
Business Legal Protect offers qualified advice and assistance with:
- Legal and tax matters concerning your business
- Criminal prosecution
- Compliance & regulation issues
- Help with unpaid invoices (over £200)
For example:
- HMRC flags you for an IR35 investigation
- You need legal help chasing a client who has not paid a significant invoice
- A client is suing for breach of contract
- You need legal or tax advice concerning your business
Electronic business equipment insurance
As a web designer, you no doubt rely on electronic equipment to deliver your work. Laptops, monitors and other components don’t come cheap anymore. As such, protecting your equipment with insurance could be a good backup plan.
Electronic business equipment insurance offers the cost of replacement if your equipment can’t be fixed. It will also cover the repair cost, including the service, and the turnaround is a lot quicker.
Always remember to keep a receipt or any other proof of ownership. It is usually the first piece of information required to start your claim.
Cyber insurance for web designers
Aside from designing and developing websites, you may need to consider cyber insurance if you also manage websites for your clients.
Cybercriminals distinguish little between their targets and will exploit anyone who appears vulnerable to their attacks.
Especially for a small business or self-employed web designer, a cyber attack could have profound implications for you as a business and an individual.
Cyber covers differ quite a lot from provider to provider. Still, a comprehensive cover should offer advice on prevention, recovery service during an attack and a ransom payout provision if the only way to recover your data is to pay.
Shopping for web designer liability insurance
Whether or not you decide to use Suited web designer insurance to protect your business, it’s worth keeping the following in mind:
Cheap web designer insurance
When choosing your web designer insurance provider, cost is not the only factor to consider. At Suited, we offer multiple channels of communication to ensure prompt support and customer satisfaction.
The reputation of the insurer is important
Insurance needs to be there when you need it most. The payout reputation of an insurer is essential. Suited uses financially sound insurers with an A+ rating.
Many providers charge fees to amend or cancel
Low initial prices often hide additional charges to pay monthly, amend or cancel your policy. At Suited, we charge no extra fees, and you can cancel anytime with no more to pay.
Some policy wordings are restrictive or have a high excess
Some providers will offer attractive prices, but it is at the expense of cover given. Suited professional indemnity and public liability have £0 excess.
