Insurance is a lot like a toilet. Toilets aren't sexy. They aren't something we spend a lot of time thinking about or talking about. No one builds a house thinking "that's where I'm putting the toilet," but you sure are glad it's there when you need it.
Likewise, when you are building your photography business, insurance probably isn't at the top of the list of things you want to think about, but it's sure nice to know your covered when the proverbial "crap" hits the fan.
As a photographer, it's easy to see how spending money on a camera is valuable for your business. It's easy to understand how a lot of expenses relate to building your business, but insurance is one of those things that you really don't think about until something goes bad. Unfortunately, by then it's too late.
I also think that another reason that photographers don't adequately protect their business is because insurance coverage can be confusing and intimidating. I'm going to try to demystify the types of insurance coverage that a typical photography business should consider, but you should definitely talk with your insurance agent about the best types of policies and protection for your business.
Lets start with the three types of coverage every photography business should have:
1. Liability Coverage
Liability Insurance is designed to do basically one thing - protect you in the event of a lawsuit or other claim. It protects your business by covering things like attorney's fees, court costs, and the cost of a judgement or settlement arising from accidents, injury or negligence. Liability coverage isn't for when something goes wrong and suddenly you've lost all the images from a wedding. We'll get to that in a few minutes.
You probably think it's unlikely you'll be sued, so why do you need liability insurance? Well, first - many venues won't even allow you to work there without liability coverage. All it takes is one person tripping over your camera bag, or a light stand, or a tipsy bridesmaid to break her ankle trying to do the classic "let's all jump up in the air while you take a picture," and you could be at risk.
The most common general liability policies have coverage of around $1 million per incident/$2 million lifetime, and this is what is usually required by venues who request to be named on your policy.
2. Property Coverage
This is insurance for your gear, equipment, etc. Usually, you're looking for an Inland Marine policy to cover camera and photographic equipment. Don't think that you're covered just because you have homeowners or renters insurance.
In fact, most homeowners polices specifically exclude camera equipment (unless you have a specific rider), and all of them exclude business related property. If you suddenly file a claim for $10,000 of gear that was stolen at a wedding you were shooting, it's likely that your Homeowners insurance will reject the claim.
Coverage for property insurance is usually based on a dollar value of the equipment covered. This can range anywhere from $1.50 - $4.00 per $100 covered, depending on the deductible, where you live, and other variables. One thing to be sure of, is that you have replacement value - NOT fair market value, or cash value.
Replacement value means that you'll receive the reimbursement for the current cost to replace an item, as opposed to fair market value, which only reimburses you for the orignal purchase price, minus depreciation.
3. Errors & Omissions
Sometimes things go bad, and sometimes they're your fault. Even when they aren't your fault, sometimes bad things happen. Sometimes hard drives fail. Sometimes you lose a compact flash card on your way home. Sometimes cameras fail, or equipment fails and you miss important shots.
This is why having some kind of Professional Liability, also known as "Errors & Omissions" coverage is valuable. Basically, this is malpractice coverage (except we're not doctors), and it protects you against things that happen that cause you to be unable to fulfill your contractual obligations to your clients.
If you are a member of PPA, you are able to take advantage of their Indemnity Trust, which - while not insurance - is similar in practice to E&O coverage. Even if you're a member of PPA, and are covered by the trust, it's still worth exploring with your insurance agent the types of Professional Liability coverage that would be appropriate for your business.
One last thing I'll suggest is that while there are insurance plans out there designed specifically for photographers, you may find that working with your local insurance agent has distinct advantages. Not only will you often qualify for multi-policy discounts by going through the same agent as your auto, home owners, and life insurance policies, there is no substitute for having a person on your side.
I've had a few claims happen on my business policy, and each time, having someone on my side who knew me, and knew my business, meant I was taken care of professionally, and quickly. I don't mean to speak poorly of those "photographers insurance" companies, but don't assume they have the best coverage, the best prices, or the best service.