2 million people in the UK work as freelancers. This is written from the point of view of someone in the largest group (37%) in that 2 million, which includes writers and designers. But the issues concern everyone currently freelancing.
Like most of us, you’ve probably hired a car at some time, and someone’s tried to flog you additional accident cover. Like most of us you’ve probably thought about it for a second, then said: ‘Nah.’
And when my father died, we had to unpick the multiple insurance policies that he’d bought and not needed. Like many elderly folk, he’d got nervous in his old age and bought everything the insurance business had tried to sell him. It turned out that he was paying £600 a month in unnecessary policies alone.
So there’s insurance cover most of us agree is a good idea. House. Car. And maybe a couple of other things besides. Fine. Don’t mind paying for them.
And then there are policies where it’s simply the insurance business trying to sell you something in the hope that you’re naïve enough not to realise that you just don’t need it.
Professional Indemnity, in my professional opinion, is one of the latter.
Well, so what? We all know what insurance our businesses need, and we can simply ignore what we don’t, right?
Wrong.
PI, as it’s not very affectionately known, is being forced on thousands of freelancers - whether they want it or not.
Let’s be clear. There’s no legal requirement for PI. And yet we’re being told that if we don’t get it, we won’t get that job we’ve pitched for. And by the way. That thing many of us don’t need, and may not want? We’ve got to pay for it out of our own pockets.
So far, so bizarre. But there’s one other aspect of PI which is crazier than all of the above. Which I’ll come to shortly.
But first, what is PI?
PI is designed, or so its proponents claim, to protect freelancers against being sued for giving incorrect advice, or making errors that result in a client’s business being damaged.
It’s also designed, so they tell us, to protect clients against such an eventuality.
So in my 20+ years as a freelance writer working in advertising and related comms, how many times have I encountered, or even heard about, a freelancer or client being involved in a legal dispute over incorrect or inadequate advice?
Here is my answer: 0. That’s right. In over two decades, this has never, at least to my knowledge, occurred.
Certainly, the occasional client will say he doesn’t like the work.
When that happens, you simply do it again. Or the client re-briefs. Or the client doesn’t work with you next time. But not once in my working life has anyone attempted to sue me, or anyone else I know, because they think our work has harmed their business.
There are reasons for that, apart from most of us always trying to do a conscientious and professional job for our clients.
1. Legal battles are expensive enough to stop most sane people from wanting to start one.
2. The work we do in advertising, design, PR and many other fields is subjective. No court in the world can say whether a creative concept can be deemed ‘good’ or ‘bad’. And no court on earth could possibly decide whether a downturn in a client’s business can be traced to inadequate design of a logo, or a sloppy press release, or a crappy headline, or a mediocre bit of content, or a misjudged brand strategy.
3. Virtually every client will already be protected against such an unlikely eventuality already through their existing terms and conditions and business insurance. Many freelancers will, too, through their own Ts&Cs, or being a Limited Company, or both.
4. Most freelancers aren’t rich enough to make it worth suing us anyway.
So why on earth would anyone think that freelancers must suddenly pay for Professional Indemnity insurance to protect both parties from legal battles that are vanishingly unlikely to happen?
Well, here’s the even crazier bit I referred to earlier. And it could provide one possible answer.
In the past month I’ve looked at various jobs advertised through recruiters. These recruiters are suddenly telling everyone that PI is now mandatory. Take it out or you can’t apply for a job on their site. (There’s no legal requirement, remember? But they’re making it compulsory anyway).
So out of curiosity I search out what insurance policy options are available. I see that I can get £50,000-worth of insurance, and the recruiter will then allow me to accept a job if one comes through.
Then I see a project on a recruiter site that catches my eye. And here’s the thing. The site is telling applicants that if they accept this job and work on-site (possible again very soon, I’m sure), my hypothetical £50,000 of cover would actually not be acceptable to the recruiting agent.
Why not? Well, it seems that £50,000 is not enough. Guess how much insurance cover I would need to be deemed an acceptable risk for this particular job?
£1,000,000 is your answer.
That’s right. £1 million-worth of insurance cover to get the job if I wanted to work on site. That would be excessive if I was Ebola-positive, psychotic, and carrying an automatic assault weapon to their office. How hazardous can one copywriter be?
Clearly this is divorced from reality. So what’s going on? Well, we can speculate.
If you accept that up till now no one wants to sue a freelancer for the reasons above, then all of a sudden that might change when there are sums like this floating around. That’s when someone might actually consider that it’s worth pursuing what until now has not been remotely viable. Now it’s worth making an issue out of.
In other words, no one needs PI now. But if everyone is forced to get it, then we’ll all need it. Just to protect us against the distant possibility of someone being unscrupulous. And at that point, PI becomes a self-fulfilling prophesy.
Put it another way. If we all go out and buy Professional Indemnity insurance, we’re all going to need Professional Indemnity insurance.
Catch-22 author Joseph Heller would love that.
And don’t forget: if you buy a PI policy as a freelancer, the lunatic who might want to sue you isn’t paying for the privilege. You are.
Pay to get yourself sued. Joe’d love that, too.
Tell me this: if you’re a client and you really think your business might be seriously damaged by working with me, by all means go ahead and get yourself your own policy to cover yourself against my incompetence. If you’re not covered already. But you want me to pay for it?
In effect, these insurance policies are not protecting anyone. They’re actually doing the opposite, by increasing the likelihood of legal disputes. I used the word ‘unscrupulous’. There’s no other way to describe the role played in this by the insurance industry.
And the blind acceptance - so far - of such snake oil by some recruiters and clients is, to put it mildly, misguided.
Let me rephrase that. It’s beyond simple acceptance. In some cases it’s enforcement. And that’s unethical.
I’ll say it again. PI is not a legal requirement as a freelancer. And mandating something that isn’t lawfully required as a condition of being able to work is wrong.
Of course, in your business, you might feel you need it. That’s fine. But that’s a matter for you, no one else. Nobody should be able to force it on you, or on the freelance community as a whole.
The spread of Professional Indemnity insurance in the property market has been roundly criticised by consumer watchdogs. And it’s just as questionable in the world of freelancing.
So let’s question it. If we don’t, PI will cost every freelancer. And if it creates a litigious landscape, which it might, it’ll cost all of us.
Win-win for insurance companies and the legal profession, sure. Lose-lose for the rest of us.
But there’s one final ironic twist.
Try Googling ‘Professional Indemnity insurance’. It looks like a sales page for the insurance business. The insurance companies are falling over themselves to spread it like a virus through the property and business communities.
What does that tell us? As we all know, the insurance business does everything in its power to avoid making pay-outs on claims. So they will already know that no one in the real world will be making successful claims for these staggering sums of money. In truth, they’re going to be paying out zip.
In its enthusiasm to flog it to us all, the insurance industry is telling us something about Professional Indemnity insurance that some recruiters and clients haven’t yet figured out. Nobody will ever end up using it.
Because it’s PI in the sky.
Based in London, Simon Carbery has worked all over the world as a freelancer for over 20 years. He was an award-winning copywriter at Saatchi & Saatchi, Head of Copy at Lowe, a creative director at Leo Burnett London, and a Member of The D&AD Executive Committee.