Chapter 2: Special Insurance Considerations for Photography and Videography Professionals
Part 2: Freelancers: What Business Insurance Can't Cover
The Problem with Stopping and Starting Insurance Coverage
Most freelancers have experienced a "dry spell." For some of you — like those in the wedding industry — sluggish seasons might be an annual occurrence. When business slows, it can be awfully tempting to drop insurance coverage. This section explains why that's not a good idea.
If the reason you want to drop coverage is financial, then it doesn't make any sense to skip insurance: If you can't afford your premiums, how will you be able to afford the cost of litigation? Property loss? An out-of-court settlement? You're essentially risking everything with the hope that nothing goes wrong.
But things do go wrong — even when it's not your fault. In "Years Later, Lawsuit Seeks to Recreate a Wedding ," the New York Times reports the story of a retired photographer who was sued by a former client years after they worked together.
The former client slapped the photographer, Dan Fried, with a Professional Liability lawsuit, six years after receiving "disappointing" wedding photos. Now divorced, the claimant made sure to get the lawsuit in before the statute of limitations expired.
Fried no longer had insurance, as he hadn't worked at the studio since 2004. The whole thing ended up costing Fried and his former business partner $50,000 of their own money. This may be, as Friend described it, "an abuse of the legal system." But it's worth noting that…
- The law allows people to file claims for years after the initial incident.
- Once you drop coverage, you are not protected against claims, even if you had coverage at the time of the incident.
This case might seem ridiculous, since the couple split and the former bride now lives in another country. But according to the Times, the judge allows the case to go to court in order to determine whether there was, indeed, a breach of contract.
Next: Chapter 3: Tips for Growing Your Small Photography / Videography Business