Charging Insurance: A Guide For Life Coaches

Life coaching is an unregulated industry, so there is no legal requirement for life coaches to have insurance. However, it is still important for life coaches to consider getting insurance to protect themselves and their business from unforeseen risks and financial damages. There are several types of insurance policies available to life coaches, including professional liability insurance, cyber liability insurance, general liability insurance, workers' compensation insurance, and commercial property and auto insurance. The cost of life coach insurance policies varies depending on factors such as the size of the business, the coach's location, and the value of their equipment.

Professional liability insurance

Life coaches can benefit from professional liability insurance, which is also known as errors and omissions (E&O) insurance. This type of insurance provides coverage for personal injury (e.g. libel and slander), defence costs, negligence, and claims against past-rendered services. It is particularly important for professionals who regularly provide services or advice to clients.

For example, if a client claims that a life coach's advice led to them being fired from their job and sues, E&O insurance could help defend the coach's business. Similarly, if a client accuses a life coach of breaching a confidentiality agreement, professional liability insurance can offer protection.

Overall, professional liability insurance is a crucial form of protection for life coaches, helping them safeguard their business and finances in the event of legal issues or accidents.

General liability insurance

Life coaches can benefit from having general liability insurance, which covers them against property damage, claims of bodily injury, and associated medical costs. This type of insurance is designed to protect life coaches from financial losses due to lawsuits or injuries. For example, if a client trips and falls during a session, general liability insurance would cover the costs of their medical expenses and lost wages.

In addition to general liability insurance, life coaches may also want to consider other types of insurance such as professional liability insurance, commercial property insurance, cyber liability insurance, and business interruption insurance, among others. These insurance policies can provide coverage for a range of risks and potential liabilities that life coaches may face in their profession.

Commercial property and auto insurance

Commercial properties can include equipment and furniture, laptops and other electronics, and cars used for business meetings. If an accident or small fire causes damage to your property, commercial property insurance will cover the costs of the damage. It will also cover you if someone breaks into your office or steals your business-owned belongings.

If you use your vehicle for work, such as picking up clients, you will likely need commercial auto insurance. Many personal auto policies will not cover losses that occur while the vehicle is being used for business purposes.

Business owner's policy insurance

As a life coach, you may provide advice and guidance to your clients, but you are not responsible for how they implement it. However, you may still face lawsuits from clients who raise claims against you. This is because the life coaching industry is largely unregulated, and there are no legal requirements or licensed certifications to start practising as a life coach.

A business owner's policy (BOP) insurance is a safety net that combines several crucial coverages into one convenient package. For life coaches, this typically includes general liability protection for property damage or third-party injuries, and professional liability protection for coaching-related claims. It also covers advertising injuries, copyright infringement, and protection against reputational damage claims. Many insurance providers offer customizable BOPs specifically designed for coaching professionals, allowing you to tailor the coverage to your unique practice needs.

For example, if a client slips and falls in your office, or if they sue you for giving them bad advice, a BOP will cover the costs associated with the client's medical expenses, including lost wages and legal fees. A BOP will also cover you if there is a fire in your building and your computer and other office equipment and furniture are destroyed.

Additionally, if you use your vehicle for work, such as picking up clients, you will likely need commercial auto insurance as many personal auto policies will not cover losses that occur while the vehicle is being used for business purposes.

Cyber liability insurance

As a life coach, you may provide your clients with advice and guidance on a range of personal topics. While you are not responsible for how your clients interpret and act on your advice, you may still face lawsuits from dissatisfied clients. This is particularly true because the life coaching industry is largely unregulated, and there are no mandatory legal requirements or licensed certifications to start practising as a life coach.

To protect yourself and your business from unforeseen risks and financial damages, it is important to have the right insurance in place. Cyber liability insurance is one type of insurance that life coaches should consider.

While cyber liability insurance is not always included in standard insurance packages, it can be added as optional coverage. For example, Alternative Balance offers cyber liability insurance as an add-on to their standard life coach liability insurance policy.

Frequently asked questions