Business Insurance Requirements for IT Consultants in Michigan

Whether you’re freelancing as a developer for a car manufacturer in Detroit or designing websites in a college town like Ann Arbor, business insurance can help protect your Michigan consulting firm against the risks that come from working in IT.

One policy many IT consultants benefit from is professional liability insurance. This policy can help pay your legal costs if a client claims you delivered a project that was late, incomplete, or full of errors. If you rent your office space, your landlord might require you to purchase general liability insurance as part of your lease agreement. Another policy to consider is commercial property insurance, which protects your business equipment, like computers, office furniture, and printers.

Insureon makes shopping for insurance easy with industry-leading technology that gathers quotes from top U.S. carriers that fit your needs. Read more to find out which policies are most common for IT consultants in Michigan, and start an application to get your free quotes today.

Find the right insurance policy for your IT consultant business

The most common policies for Michigan IT consultants vary depending on a number of factors, including revenue, client contracts, and partnerships. The table below illustrates which policies might work best for your business size.

 

Business type General liability / BOP Professional liability Cyber liability Fidelity bond Workers' comp
Sole proprietor X X X    
Business owner with employees X X X X X
1099 or independent contractor X X X    

 

General liability insurance: General liability insurance is the foundation of an IT consultant’s business protection, with coverage that extends to bodily injury, client property damage, advertising injury, and the cost of legal defense. 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.

Professional liability insurance: Many clients require proof of professional liability insurance before entering into contracts for professional services. This policy, also called errors and omissions insurance or IT consultant liability insurance, can help cover legal expenses if you’re sued for unsatisfactory work or a business discrepancy.

Cyber liability insurance: Cyber liability insurance helps businesses survive data breaches and cyberattacks by helping to cover recovery expenses. This policy is particularly important for IT consultants, since it can protect you if there’s a breach of your client’s data during a project. Many professional liability policies include cyber liability coverage. Ask your agent if you already have it, or if you need to purchase a standalone policy.

Fidelity bond: Clients in banking or financial services often require IT consultants to carry this 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 workers' compensation: If an employee is injured on the job, workers’ compensation insurance can help pay for medical fees and lost wages. Employers in Michigan are required to purchase workers’ comp 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. Accidents can happen in any profession, and IT is no exception. In the IT industry, falls, slips, and trips – which can happen to anyone in any industry – are most common, followed by overexertion and bodily reaction, according to the U.S. Bureau of Labor Statistics.

Business insurance costs for IT consultants in Michigan

According to an analysis of Insureon applications, IT consultants in Michigan can expect to pay roughly the same amount for business insurance as 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 average. However, workers’ comp typically costs only $625 annually, which is significantly less than the national median of $1,000.

Median Insurance Costs for Michigan IT Consultants

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 dozens of top U.S. carriers. Simply apply online and review quotes for the policies that best fit your business needs. Our insurance specialists are licensed in Michigan and can answer your questions as you consider coverage.

To make the application go even 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.