Learn about business insurance requirements and the most common policies for IT consultants in Michigan.
Which policies are required for an IT consultant in Michigan?
If you have a commercial lease, your property manager may require you to purchase general liability insurance. Commonly purchased by IT consultants in Michigan, general liability insurance can protect your business from expenses associated with common mishaps, such as client property damage and injuries.
Your clients may require errors and omissions insurance in a contract. Also called professional liability insurance, errors and omissions insurance provides financial protection if a client files a lawsuit claiming your work caused financial harm because it was late, erroneous, or incomplete.
State law in Michigan requires workers’ compensation coverage for companies that employ at least one worker for 35 or more hours per week for at least three months, or if they employ three or more people at any one time. Business-owned vehicles must be covered by commercial auto insurance. Personal vehicles used for business purposes should have commercial coverage, as well.
What are the most common policies for a Michigan IT consultant?
The most common policies for IT consultants in Michigan vary depending on revenue, client contracts, partnerships, and other factors.
General liability insurance
General liability insurance is the foundation of an IT consultant’s business protection, with coverage that extends to client injuries, client property damage, and advertising injuries. Most commercial leases require you to have this coverage.
Business owner's policy (BOP)
IT consultants often qualify for a business owner’s policy. This package helps your business save money by bundling commercial property insurance with general liability at an affordable rate.
Errors and omissions insurance (E&O)
Many clients require proof of technology errors and omissions insurance before entering into contracts for professional services. This policy, also called professional liability insurance or IT consultant liability insurance, can help cover legal expenses if you’re sued for unsatisfactory performance or a work mistake.
Cyber liability insurance
Cyber liability insurance can help IT consultants survive data breaches and cyberattacks experienced by your company or a client whose systems you are responsible for protecting. Many professional liability policies include this coverage, but check with your licensed Insureon agent to make sure.
Clients in banking or financial services often require IT consultants to carry a fidelity bond. Also called an employee dishonesty bond, it provides coverage when an employee steals money, equipment, or other assets from one of your clients. That includes theft by electronic funds transfer.
Michigan worker's compensation
Employers in Michigan are required to purchase workers’ compensation insurance if they employ at least one worker for 35 or more hours per week for at least three months, or if they employ three or more people at any one time. That means if you have any full-time employees, you’ll probably need to purchase this coverage. Even if it’s not mandatory for your IT consultant business, it’s still a good idea to get covered. Workers' comp can help pay for medical fees and lost wages if an employee is injured on the job – something that can happen in any industry.
Commercial auto insurance
Personal auto insurance policies typically exclude business use, which means you could end up paying for an auto accident if it happens on a work errand with your personal vehicle. Commercial auto insurance is required for vehicles owned by IT consulting companies. Hired and non-owned auto insurance covers personal vehicles used for business purposes.
What do IT consultants in Michigan pay for business insurance?
According to an analysis of Insureon applications, IT consultants in Michigan can expect business insurance premiums that are similar to the national median. In some cases, you’ll pay a little more, and for other policies, a little less. Michigan IT consultants can expect to pay roughly $2,700 per year for errors and omissions insurance, which is slightly higher than the national median. However, workers’ comp in Michigan typically costs only $625 annually, which is significantly less than the national median of $1,000.
Save time and money with Insureon
Insureon’s industry-leading technology helps IT consultants in Michigan save time and money shopping for insurance by comparing policies from top U.S. carriers. Start a free online application to review quotes for the policies that best fit your business needs. Our insurance agents are licensed in Michigan and can answer your questions as you consider coverage.
To make the application go quicker, have this information ready:
- Workforce details, such as the number and types of employees
- Current and projected revenue
- Business partnerships
- Insurance history and prior claims
- Commercial lease insurance requirements
Apply for free IT consultant insurance quotes today.