As inflation continues to take a toll on household budgets across America, more workers are considering picking up a second job to help make ends meet. Unlike part-time employment, a side hustle allows an individual to retain control over the work they do and the hours they devote to it. These ventures can include tutoring, dog walking, video editing, rideshare driving, and countless others. In fact, a recent study from Fiverr found that 74% of American workers plan on starting or continuing a side hustle in 2024. *
As individuals take on side hustles to generate more income or out of a desire to operate their own businesses, they also take on risks. If you are considering adding a side hustle to your income stream, the first thing you need to understand is what risks are not covered by your existing insurance policies. While your current home and auto coverage may offer some protection, even the smallest side hustle could severely damage an individual’s finances without the appropriate insurance policies in place.
Liability Insurance
Your homeowners policy likely includes liability insurance in case someone gets injured in your home. However, the coverage does not typically extend to a home-based business. If a client slips and falls while visiting your home office, your home insurance may not cover the resulting medical or legal expenses should that individual decide to sue. Additionally, if you are renting out a room or your entire home on an app like VRBO or Airbnb, coverage may be excluded for any losses.
Cyber Insurance
If your side hustle relies on technology to collect payments or customer data, it is wise to consider purchasing cyber insurance. In the unfortunate event that a hacker steals your customers’ credit card data, would you be able to recoup your losses? Cyber insurance can protect you and your business in the event of a data breech, whether your computer is hacked or your phone containing sensitive information is stolen.
Auto Insurance
Some automotive policies are for personal use only, while other may cover a business-related accident with limited coverage. If your side hustle involves driving and you get into an accident, do you know whether your insurance will cover you? If you are employed as a rideshare or delivery driver, you need to know whether the company’s insurance covers you and what the limits are for collision, liability, and medical.
Fire Insurance
Your existing homeowners policy likely provides coverage for losses incurred in a fire. However, that protection may not extend beyond your personal belongings. If you run a business out of your home, you may want to consider purchasing additional coverage to protect expensive office equipment or your business inventory in the event of a fire.
Regardless of the nature of your side hustle, adding on the right insurance policies can help keep business running smoothly. At South Carolina Federal Insurance Solutions, experienced advisors can help you evaluate your side hustle, assess your existing coverage, determine where your personal coverage ends, and identify gaps in your business coverage. Contact us today to get started!
