Adapting Insurance Solutions for Freelancers in the Gig Economy
Many Americans are increasingly engaging in independent work, prompting the insurance industry to adapt by offering new products and simplified purchasing options tailored to freelancers and the self-employed. Will Infantine, managing director at King Insurance in Manchester, notes that the industry is developing better insurance solutions for these individuals.
According to the Census Bureau, in 2023, there were 30.4 million entities without payroll, including professions like Uber drivers, freelance writers, and independent consultants. This figure has risen from 23 million a decade ago. In New Hampshire alone, such ventures generated an estimated $8.4 billion in revenue.
Insurance firms are eager to capture this growing market. Jon Gray of the Freelancers Union highlights the sector's interest in integrating into this market, recognizing freelancing as a future trend. Infantine mentions a significant shift in the availability of affordable liability coverage for independent professionals, emphasizing easy access to policies through online platforms, such as those offered by new entrants like Next Insurance and established brands like Berkshire Hathaway’s BiBERK.
Adapting Underwriting Processes for Freelancers
As freelance roles evolve, the insurance industry must adapt its underwriting processes. While traditional risk assessments for occupations like plumbing are familiar, determining the risks for roles such as content creators or consultants poses new challenges. Companies now utilize simple criteria to assess risks, allowing for streamlined pricing decisions.
Mary Duggan Hoeprich of Gild Insurance Agency stresses the importance of convenience for small business owners, who may purchase insurance at any time online. Thimble offers flexible coverage options "by the job, month, or year," although Hoeprich notes broad on-demand coverage is not yet widespread. The industry continues to innovate, providing customized policies suitable for a range of non-traditional occupations.
Customized Insurance Packages and Future Growth
Gild and Blitz Insurance collaborated to offer custom insurance packages for professionals like massage therapists and estheticians, combining liability and other coverages at various pricing levels. Blitz's Landon Reid highlights the need for flexible pricing to accommodate professionals with different revenue levels.
Freelancers often face challenges in securing traditional employee benefits. Professional associations like the Freelancers Union partner with insurers to provide health, disability, and life insurance. Opolis enables freelancers to maintain their independence while accessing benefits traditionally associated with W2 employment through forming a corporate entity.
Infantine observes that insurers are keen to nurture relationships with freelancers who may grow into larger businesses, potentially becoming long-term clients. This strategic foresight positions insurers to support future business leaders as they scale and expand their operations.