What insurance does a solopreneur actually need?
Three types, in order of priority: (1) Health insurance. This is non-negotiable. A single emergency can wipe out your savings. I use a high-deductible plan ($300/mo) with an HSA. (2) General liability insurance. If you advise clients or have a physical office, get it. $300/year from Hiscox. (3) Professional liability (errors and omissions). If you give paid advice, this covers you if a client claims your advice cost them money.
Most solopreneurs can skip: disability insurance (expensive, low probability), life insurance (only needed if someone depends on your income), and business interruption insurance (overkill for solo founders).
How much should a solopreneur budget for insurance?
My total insurance cost: $4,200/year. Health: $3,600 ($300/mo). Liability: $300/year. Professional: $300/year. That is 4% of my gross income at $100K. Worth every penny. The peace of mind lets me take bigger risks in my business. Compare costs on Policygenius.
Health insurance premiums are tax deductible if you are self-employed. That $3,600/year deduction saved me $1,080 in taxes at 30%. The Tax Guide covers how to claim it.
I am a solopreneur in [industry] making [amount]/year. Recommend an insurance stack for me. Include: health, liability, and professional insurance. Give estimated costs, what each covers, and where to buy them. Keep the total under $200/month.
Read the related guide for more.
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