Professional Indemnity Insurance Explained (For Freelancers & Consultants, 2026)
Professional Indemnity Insurance (PI) protects freelancers and small business owners if a client claims your work caused them financial loss.
It’s especially important for consultants, designers, digital professionals, and anyone whose advice, deliverables, or expertise could impact a client’s business.
This guide explains what PI covers, who needs it, how much it costs, and how to buy it in 2026.
❓ What Does Professional Indemnity Insurance Cover?
PI insurance generally covers claims such as:
- Mistakes or errors in your work
- Negligent advice or guidance
- Missed deadlines that cause client loss
- Breaches of professional duty
- Legal defence costs for related claims
- Compensation payments if you’re liable
Note: PI does not cover injury to people or property (that’s Public Liability Insurance), nor does it cover your own equipment or lost income.
👉 If you want to compare insurance providers, check our new 2026 guide: Compare Insurance Providers for 2026
👤 Who Needs Professional Indemnity Insurance?
Freelancers and consultants who provide professional advice, creative work, or services that could affect a client’s finances should consider PI:
- Graphic designers
- Consultants (business, marketing, IT)
- Web developers & programmers
- Accountants & bookkeepers
- Financial advisers
- Copywriters, editors, and content strategists
- Architects and engineers
Even if not legally required, many clients or agencies demand PI coverage before awarding contracts.
💷 How Much Does Professional Indemnity Insurance Cost in 2026?
Typical freelancer PI costs:
- £100–£250/year for standard freelance roles
- £250–£500/year for high-risk or specialist consulting
- Cover limits usually range from £250k–£2m
Factors affecting cost:
- Industry & profession
- Contract size
- Past claims history
- Number of clients per year
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🛡️ How Much Cover Do You Need?
- £250,000–£500,000 — suitable for most small freelance contracts
- £1 million — for high-value projects or corporate clients
- £2 million+ — for complex consulting or international contracts
Always check if a client contract specifies a minimum requirement.
⭐ Recommended Provider
PolicyBee offers PI insurance tailored for freelancers and small businesses.
- Quick online quotes
- Flexible cover options
- Add-ons for tools, PL, and income protection
- Clear UK-based support
✅ Conclusion
Professional Indemnity Insurance isn’t legally required for most freelancers — but for anyone offering professional advice, deliverables, or consultancy, it’s essential to protect your income and reputation.
Start with a limit that matches your contract value and scale up as your business grows. Pair it with Public Liability Insurance for full protection, and you’ll be ready to take on clients with confidence.
Read next:
👉 Public Liability Insurance for Freelancers
👉Tools & Equipment Insurance for Freelancers