Insurance… and specifically business & liability insurance may be quite boring topics for most; but in reality, coaches find themselves wondering what type of protection makes sense for them, how do they navigate the sometimes complex world of insurance products to determines what makes sense for their specific situation.
Do life coaches need insurance
Every life coach (especially new coaches) needs to have at least Personal Liability Insurance to help protect themselves and their business. There are a plenty insurance options to pick from, with different deductibles, coverage, and premiums. Whether you are a starting coach or an established one, all life coaches should consider acquiring business insurance coverage.
What is Professional Liability insurance?
Professional Liability Insurance, or also known as “Errors and Omissions Insurance” in the professional insurance world, is a specifically designed insurance coverage product to help professionals (like doctors, engineers, and other professionals) protect themselves from different risks in their work.
Why Professional Liability Insurance is important for a life coach?
Life coaches, like other consulting professionals, get to know certain aspects of their clients in a substantial level; but not only do the coaches get exposed to their client’s life, they are actually there to help their client navigate & affect positive changes, accomplish goals, identify and remove obstacles.
This type of work requires that the coaches protect themselves from any potential risk or liability.
Ultimately, it is the client’s responsibility to make informed decisions in their lives, have reasonable expectations and at the end of the day… own their lives.
As life coaches accompany their clients in their life journey and engage in deeper conversations that may affect the client’s decision-making processes, outcomes are sometimes different than the original plan or expectations. It is for these cases that a life coach should have proper insurance coverage.
What should a coach look for in professional liability insurance?
We recommend to all our students that they, at least get some form of liability insurance. Every insurance policy is crafted differently but basically, they can cover a combination of the following:
- Protect against alleged claims or lawsuits brought against you
- Pay legal defense costs and compensatory damages if you are found liable
- Equip you with legal advice for addressing sensitive employee issues, understanding complex contracts, knowing your rights as a tenant, tax law
- Cover your business from issues that may arise from work done by your employees
- Cover independent contractors administering services on behalf of your business
Important points to consider when evaluating professional liability products
Legal Services
Coverage for legal services and advice: This type of coverage is for cases where professional external legal counsel is required; the insurance company will pay for legal representation, advice and services to you (the coach) in any legal adjudications, deliberations, negotiations etc.
Simple explanation: You, the coach expects the insurance company to provide you with lawyers to help and protect you.
Reality: be aware that the legal service/advice offered and paid by the insurance company is actually representing the interests of the insurance company and not you, the coach.
Location Coverage
Life coaching services are usually not location dependant; your client may be located in a different city, region, country or even continent. In our current reality it is very likely that coaching services are provided via video conference calls, phone or other forms of electronic & remote communications.
It is important to verify that your insurance provides proper coverage for working with clients that are not in your vicinity and that you are not limited to offer your services safely globally.
How and Where a life coach can buy insurance?
Usually, you will work with an insurance broker to tailor the specific policy to your need. It is possible to work directly with the underwriting insurance company, but in reality, you will be working with the brokering arm of the insurance company. The broker will try to match the needs of your specific coaching business to the insurance policies offered by the Insurance companies (underwriters) they work with.
Sometimes, insurance companies have specific policies or packages designed specifically for a professional order or association. This is usually a more economical option but it does no take into account the specifics of the individual coach.
Insurance for Starting Coaches
As a starting coach, when looking for liability insurance check into the insurance options offered by local coaching associations. Even if you’re not an official member of the association they might offer the group’s insurance benefits to you. Though they are generally the simplest insurance products with limited and basic coverage, it may make for a great starting point as a new coach.
A local coaches association might have negotiated special deals with some local insurance companies that they can refer you to. A more known coaches association is ICF (International Coaching Federation) that is referring its members to Westminster Insurance (see details below)
Insurance for Established Coaches
Once you become a more established coach, consider upgrading to a tailored policy by a specialized business insurance broker. Especially when your workload grows, or you have other coaches or supporting professionals working for you.
Note: When buying business insurance, you usually have to go through a broker that may work with different insurance companies. You should consider the insurance broker as a salesperson for the insurance company and make sure that all your best interests are considered.
Life Coaching insurance in Canada
One of the insurance brokerages companies we have seen is ProLink. Their main offices are located in Toronto, ON but their services are available all over Canada. They can offer coaches tailored insurance policies from different underwriting insurance companies.
- ProLink Insurance website [https://prolink.insure/]
- ProLink Professional Coach Insurance Program [https://prolink.insure/icps/coach/]
Life Coaching insurance in UK, Ireland, Canada & USA
Westminster Insurance is a global insurance provider that ICF (the largest coaches association) has negotiated the coaches coverage options:
| Country | Link |
| USA | https://us.westminster.global/ |
| UK | https://uk.westminster.global/ |
| Ireland | https://roi.westminster.global/ |
| Canada | https://ca.westminster.global/ |
| Global | https://westminster.global/ |
Examples of insurance options for life coaches
Determining the price of an insurance coverage for life coaches is a process that factors many elements that your insurance broker will guide you though. Many factors come into play and each company has its own requirements and set of questions.
The main aspects that are often considered are:
- Your expected annual volume of business revenue – how much do you expect to earn as a coach or how much are you already earning as coach. The more you earn the more expensive your liability insurance will be
- The type of work that you do – Are you consulting, coaching, offering additional services such as para-medical services (e.g. naturopathic consulting or similar)
- Your insurance history
- Have you had liability insurance before?
- Were there any claims in the past?
- Are there current claims in progress?
- Do you want coverage for past clients/work or only for new clients and coaching work?
We have collected several examples of liability insurance quotes we have seen in the past.
* The following examples are for illustration purpose only:
| Errors & Omissions (E&O) Liability Insurance | Option A |
| Limit of liability, per claim: | $1,000,000 |
| Limit of liability, per policy period | $1,000,000 |
| Deductible | $1,000 |
| Annual premium | $1,500 |
| Errors & Omissions (E&O) Liability Insurance | Option B |
| Limit of liability, per claim: | $2,000,000 |
| Limit of liability, per policy period | $2,000,000 |
| Deductible | $1,000 |
| Annual premium | $2,000 |
What other insurance should I consider?
The only other type of insurance that you should consider getting for your business is Commercial General Liability (CGL) insurance and in rare cases property insurance. However, CGL insurance is only relevant when you come to lease a commercial space (offices, practice space, etc.) in which you intend to conduct coaching business in.
It is very likely that your landlord will demand that you get a CGL insurance policy before you can occupy the space you have leased. There will be dedicated clauses in the lease contract, specifically worded to explain the type of insurance coverage needed.
CGL coverage is actually very good for you as a renter because not only does it protect you and your business it may also cover:
- Bodily Injury and Property Damage Liability
- Personal Injury and Advertising Injury Liability
- Medical Payments
- Tenants Legal Liability
Examples of CGL Insurance
The following are examples of quotes we have seen in major North American metropolitan cities:
- Office located in the downtown area – the financial hub of the city
- Office area of around 1200sf
* The following examples are for illustration purpose only:
| Commercial General Liability (CGL) Insurance | Option A |
| Bodily injury and property damage, per occurrence: | $1,000,000 |
| Personal injury, per occurrence | $1,000,000 |
| Products & completed operations coverage, per occurrence & policy limit | $1,000,000 |
| Employer’s liability | $1,000,000 |
| Employee benefits liability | $1,000,000 |
| Tenants legal liability | $500,000 |
| Limit of liability, per policy period | $1,000,000 |
| Deductible | $1,000 |
| Annual premium | $745 |
| Commercial General Liability (CGL) Insurance | Option B |
| Bodily injury and property damage, per occurrence: | $2,000,000 |
| Personal injury, per occurrence | $2,000,000 |
| Products & completed operations coverage, per occurrence & policy limit | $2,000,000 |
| Employer’s liability | $1,000,000 |
| Employee benefits liability | $1,000,000 |
| Tenants legal liability | $500,000 |
| Limit of liability, per policy period | $2,000,000 |
| Deductible | $1,000 |
| Annual premium | $900 |
Summary
As a life coach, it is your responsibility (and a very important one) to speak with professionals to determine the type of insurance protection that makes sense for your coaching business reality. The most common insurance you should consider is the “Errors & Omissions insurance” – best know in simpler words as “Professional Liability Insurance”.
Your professional coaching associations (the local chapter or national organizations) may have already done the heavy lifting and shopped around for insurance options that may be relevant to you – especially if you are starting your journey as a professional life coach.
Once your business grows or if the group policies offered by the associations are not available to you, reach out to a specialized insurance broker and protect yourself and your business.
