What Every Graphic Designer Should Know About Insurance
(And how you can easily find the right coverage)
Graphic designers plan, design and manage the production of a wide variety of visual communication devices, including printed materials, packaging, websites, advertising, signs and corporate logos. Businesses in the graphic design industry may include these:
- Commercial art studios
- Independent commercial or graphic artists
- Illustrators or medical artists
- Graphic design consultants
Graphic designers must have an artist’s flair and the technical savvy to produce computer-generated images and designs, websites and even videos.
While the graphic design business may seem low-risk, there are some very serious exposures that you need to be aware of and should take steps to mitigate even if you are a sole proprietor with a home-based business.
- Copyright infringement, even if unintentional
- Theft and crime
- Professional negligence
- Damage to a client’s property
- Damage to your business property
Whether you are an independent designer or a design firm owner with employees and a significant amount of business property, you need comprehensive graphic designer insurance that is tailored to your needs.
Overview of Insurance for Graphic Designers
Graphic designer insurance is made up of several types of standalone or packaged policies that are customized for your unique exposures.
Commercial general liability (CGL) insurance offers broad coverage for lawsuits related to third-party bodily injury and property damage. For a graphic designer, this might mean:
- a client, vendor or delivery person slips and falls on your business premises.
- you or an employee damages a client’s property.
- you inadvertently use copyrighted material.
- you are accused of false advertising.
- you are accused of libel or slander.
CGL insurance covers the cost of medical bills and replacing damaged property, as well as your legal defense if you are sued. If you are required to pay a settlement or judgment as a result of a lawsuit, your general liability policy pays up to the limits of your policy.
Commercial property insurance protects your business property whether it is a building that you own or the contents of your office space (computers, office furniture, supplies, etc.). If your business property is damaged by fire, weather, theft or vandalism, your business property policy pays to repair or replace it.
Your property policy should also include coverage for business interruption, or business income coverage. This valuable coverage pays for ongoing expenses (rent, salaries, etc.) if you are unable to operate or must temporarily relocate after a covered loss (e.g., a fire).
Your graphic design business likely qualifies for a business owners policy (BOP), which is a convenient package policy designed for small, low-risk businesses. With a BOP, you can have liability, property and business interruption coverage in one affordable package customized or your business.
Talk to your independent insurance agent about whether you qualify for a BOP.
Graphic Designers Professional Liability Insurance
Your clients rely on you for your skills and expertise. Along with your artistic abilities, you provide advice on strategy and branding and create materials that likely become the public face for your clients. A mistake or negligence on your part could harm a client’s reputation and even cause financial harm.
Even if a negligence claim against you is unfounded, you still have to defend yourself if you are sued. Graphic designers professional liability insurance protects you if your advice or services cause financial harm to a client. You can be sued for any number of reasons, including the following:
- Actual or alleged errors, omissions or negligence
- Plagiarism, piracy or copyright infringement
If you don’t have the right graphic designer insurance coverage, your personal assets could be at risk. Your graphic designers professional liability policy pays for your legal defense, including attorney fees, court costs, and any settlements or judgments that you must pay.
Is Your Home Office Equipment Covered When You Work from Home?
If you work out of your home full-time or even just some of the time, you may be uninsured or underinsured if you think you have coverage under your homeowners insurance policy.
A typical homeowners insurance policy limits coverage for office equipment to around $2,500 — not nearly enough to replace a computer, printer, phones, desk, fax, scanner, or other equipment or supplies you need for your graphic design business.
And your homeowners policy does not cover business liability, loss or damage of business records, and damage caused by business interruption.
If you have a home office, you have several options in order to make sure you have appropriate coverage:
- Endorsement to your homeowners insurance policy: Independent graphic designers can add an endorsement to a homeowners insurance policy that provides more coverage for the home-based business or home office. This option is viable for one-person businesses without a lot of valuable equipment or business-related visitors. The endorsement typically adds about $2,500 in business equipment coverage as well as some additional liability protection at an affordable price.
- In-home business/home office insurance: Some insurance companies offer a specialty policy for in-home businesses or home offices. The in-home business policy includes certain features of business insurance policies designed for larger firms, but sometimes with much lower policy limits. A typical in-home business policy provides business property coverage of $10,000 and a liability coverage limit typically between $300,000 and $1 million. It may also provide limited coverage for loss of valuable documents, accounts receivable, off-site business property and use of equipment.
- Business owners policy: A BOP as described above is often recommended for home-based business owners who need more than $10,000 of business property coverage as well as liability coverage for customer injuries and business interruption coverage.
Other Insurance for Graphic Designers
If you own a larger graphic design studio with employees, you may have the need for additional graphic design insurance. Talk to your independent agent about your need for the following:
- Workers’ compensation insurance
- Employment practices liability insurance
- Cyber liability insurance
- Nonowned auto liability coverage
You need tailored coverage that addresses your unique business risks and a local agent who will get to know you and be your trusted adviser for the long term.