Solo Biz Soft Editorial Team These two get confused constantly, and the mix-up matters: they cover completely different kinds of claims, and having one doesn’t mean you’re covered by the other. Here’s the actual difference, what each typically costs, and which ones freelancers tend to need.
What general liability actually covers
General liability insurance covers third-party claims of physical injury or property damage connected to your business. The classic example is a client slipping and falling during a visit to your home office or studio, or your equipment accidentally damaging a client’s property while you’re working on-site. If you never meet clients in person and never work on anyone’s property, your exposure here is lower, but many landlords and corporate clients require proof of general liability coverage before they’ll even let you through the door or sign a contract — so it’s sometimes a practical requirement as much as a risk-management one.
What professional liability (E&O) actually covers
Professional liability, also called errors and omissions (E&O) insurance, covers financial harm a client claims your work, advice, or a missed deadline caused them — not physical injury. If a client says your design error cost them sales, your missed deadline cost them a contract, or your advice led to a financial loss, general liability won’t respond to that claim at all; it’s specifically what professional liability exists for. This is usually the more relevant policy for consultants, designers, developers, writers, and anyone whose main business risk is a client being unhappy with the work itself rather than getting physically hurt.
What they typically cost
Costs vary a lot by industry, location, revenue and coverage limits, so treat any number as a rough starting point, not a quote. Across several insurance marketplaces, general liability for small service businesses commonly runs somewhere in the roughly $30 to $60 a month range, often less for a solo freelancer working from home. Professional liability tends to cost more and varies more by field: lower-risk services can be as low as $20–50 a month, while technical fields like software development often run $80–110 a month or more, since the potential financial claim is larger. The only way to get a real number is a quote from a licensed broker or insurer, since these ranges can shift substantially based on your specific business.
Which one do you actually need?
If you meet clients in person, work from a studio or office, or handle physical equipment on someone else’s property, general liability is the more obviously relevant policy. If your entire business risk is “the client doesn’t like the result” or “my advice turned out to be wrong,” professional liability is the one that actually responds to that. Plenty of consultants and freelancers who work entirely remotely still carry general liability anyway, mainly because clients contractually require proof of it. Many providers offer a combined package for both, which is often cheaper than buying them separately.
Frequently asked questions
Do I need both general liability and professional liability?
Many freelancers carry both, often as a combined policy, since they cover entirely different kinds of claims. Whether you need both depends on how you work and what your clients require contractually.
Is professional liability the same as professional indemnity insurance?
Yes, these are generally the same type of coverage under different names — professional indemnity is the more common term outside the US, errors and omissions (E&O) and professional liability are the more common US terms.
Can I get an exact price without talking to an insurer?
Not reliably. Real premiums depend on underwriting factors specific to your business, so online estimates are only a rough starting point — get an actual quote from a licensed broker or insurer before budgeting around a number.
If you have physical equipment, inventory or a studio to protect, also see the business owner’s policy (BOP), which bundles general liability with property coverage, often more cheaply than buying both separately.
If you ever do physical work on a client’s site, also see whether self-employed people need workers’ comp — it is a different kind of coverage from general liability and usually isn’t required for a solo operator, with some exceptions.
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This article is general information, not insurance or legal advice. Coverage needs and costs vary by business, industry, location and insurer — get a quote from a licensed broker or insurer before buying any policy.
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