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Commercial Insurance for Creative Businesses


You may be a creative genius, but you still need some business smarts. Risk management is a key part of business success, and just like businesses in other industries, creative businesses need protection.

Running a Business in the Creative Industry

Despite the “starving artist” stereotype, creatives need to make a living just like anyone else. Whether you’re work in photography, design, publishing or another creative field, you know you deserve both recognition and compensation for your work.

The truth is that creativity is big business. According to a report from Americans for the Arts, there were 673,656 businesses involved in the creation and distribution of the arts in the U.S. as of 2017. That’s about 4% of all U.S. businesses.

For many creatives, starting your own business is a great way to find success. It puts you in the driver’s seat, and that can give you the control you need to carry out your vision. But here’s the thing about being in the driver’s seat – you’re responsible for anything that goes wrong.

What Can Go Wrong?

As a creative, you might not think you have much risk. After all, you’re not performing surgery or managing people’s finances. What could go wrong?

Well, a lot of things. Here are just a few of the many exposures that could affect your creative work:

  • Intellectual Property Claims: Claims over copyright, trademark and other intellectual property issues can lead to expensive lawsuits. Even if you’re careful about respecting other people’s IP, you could still be accused of wrongdoing – perhaps even maliciously. “Trademark trolls,” for example, may try to make money by filing trademarks so they can sue others for infringement.
  • Contract Breaches: If you miss a deadline, you could be accused of breaching your contract. Claims could also occur if a client is unhappy with your work and claims you failed to fulfil the requirements of the contract, or if you breach another clause, such as a non-disclosure agreement.
  • Defamation: Businessowners may be accused of libel or slander. These claims sometime arise in the course of advertising, for example, if you are critical of a competitor.
  • Bodily Injuries: As a creative, you might have a hard time seeing how your work could result in bodily injury, but it may be possible. According to Insider, a woman sued after a necklace purchased through Etsy strangled her son. You could also be sued for injuries that occur on your property, for example, if a client slips and falls at your studio.
  • Property Damage: Property damage may occur in unexpected ways. For example, perhaps you’re setting up a display at an art show and your ladder tips over and destroys another artist’s display.
  • Negligence: An error or oversight on your part could end up causing financial losses for your client. Certain creatives, such as architects, may be especially vulnerable to this risk, but other creatives may not be immune.

Each business is different, and your exposures will depend on the details of your business. The point, however, is that you do have exposures – possibly far more than you realize.

Protecting Your Career

There are many ways you can, and should, protect your career. This may include educating yourself on the relevant laws and reviewing your contracts carefully before signing anything. It should also include appropriate insurance coverage.

For a creative business, appropriate insurance might include the following common coverages:

  • General Liability Insurance: This coverage can provide protection for property damage, bodily injury and advertising injury.
  • Professional Liability Insurance: This policy type is sometimes called errors and omissions coverage. It provides protections against claims that your services resulted in financial loss for a third party.
  • Workers’ Compensation Insurance: If you have employees, this coverage may be required, depending on your state.
  • Commercial Property Insurance: If you have an office or studio, this is important coverage. If you work out of your home, check your homeowners insurance – it may not provide the protection you need for commercial enterprises.
  • Commercial Auto Insurance: If your company owns a vehicle, you need commercial auto insurance. If you use personal vehicles for work, see if you need hired and non-owned commercial auto insurance.
  • Cyber Insurance: Cyber coverage may be excluded from other policies, but standalone policies are available.

Depending on your exact circumstances, you may need other insurance coverages, as well. An insurance agent can help you examine your risks and put together an appropriate package.

FICOH offers a variety of insurance coverages to meet the needs of Hawaii’s small businesses. Learn more here.