186 - Business liability insurance v's none

Debate with Nathan Wrigley and David Waumsley

Setting up the Debate

"Web professionals should not only think about insurance, but also understand it. Insurance is something we don’t necessarily want to budget for or consider, yet as professionals, we have to”

Scope creep, unexpected project delays, client relationships breaking down, and unpaid invoices. The good news is that there’s an insurance policy to help with these scenarios. In the UK, we call it “professional indemnity insurance.” Elsewhere, it can be called “professional liability” or “errors and omissions insurance.”

Here's a primer article that might get you up to speed from Smashing Magazine:
https://www.smashingmagazine.com/2018/03/guide-business-insurance-designers-developers/

We also found that people were talking about this and wanting some clarity in the WordPress Facebook groups that we frequent:

WP Builds Group
https://www.facebook.com/groups/wpbuilds/permalink/3219295024801940/

Beaver Builder Group
https://www.facebook.com/groups/beaverbuilders/permalink/1470031866489491/

For business liability insurance

• All the augment "for" are here:
  https://www.smashingmagazine.com/2018/03/guide-business-insurance-designers-developers/
• Some say they get insurance for maybe $20 - 30 per month
• https://www.techinsurance.com/professions/web-design
• https://www.hiscox.com/small-business-insurance/professional-business-insurance/web-design-insurance

Against business liability insurance from David's perspective...

David is working 'with' clients more than 'for' clients and perhaps this method insulates him from the need to protect himself with insurance?

• Can you ever have enough to protect you?  The Smashing Magazine piece talks about needing cover from £100,000 - running to millions!
• No Legal requirement - at least in the UK.
• Like all insurers they are using your fears to sell you something.
• Can’t we safeguard in other ways? What about moving to hourly rates for work. Then you don't deliver a result and frame it as a collaboration with clients!
• Scope creep is paid for (it’s an agile pay as you go scheme).
• Project delays don’t matter - they pay upfront hours up to a deadline. I have a way to use those hour even if they are delayed.
• Client relationship break down. In one session I don’t charge anything I could not refund. The client can only pay more if they choose to - which assumes they are happy too.
• Intellectual property - not relevant - GPL code (or CC zero).
• Negligence - surely this can be escaped? If you start from the position they you can’t control the software or service use. More so I can control what they do.

Final thoughts from David...

If you charge on promises of end results and a lot of money is at sake then probably you need some protection. Always balance your risks.