Last Updated: May 30, 2024, 10:33 am by TRUiC Team

Creative Agency Business Insurance

Getting insurance for your creative agency is essential.

Creative agencies can face numerous types of financial liabilities from which they need protection, such as trademark infringement lawsuits and personal injury claims. 

For example, someone could sue your company for trademark infringement over your logo design, or a client could claim that your advice caused them financial loss. 

We’ll help you find the most personalized and affordable coverage for your unique business.

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Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.

Best Insurance for a Creative Agency

General liability insurance is — generally speaking — one of the most important insurance policies for creative agencies. 

Some of the risks general liability insurance covers are:

  • Bodily injury
  • Property damage
  • Medical payments
  • Legal defense and judgment
  • Personal and advertising injury

Every business should have at least general liability insurance. However, this doesn’t cover every type of liability your company may face. For more complete protection, we suggest other policies like: 

  • Workers’ compensation insurance
  • Commercial auto insurance
  • Commercial property coverage
  • Commercial umbrella insurance 

As you shop for business insurance, you’ll soon notice that providers generally fall into one of two categories. Each has its pros and cons, so choose one that best meets your needs and budget.

  • Traditional brick-and-mortar insurers: Exemplified by large, well-established companies like The Hartford and Nationwide, traditional insurers use agents to sell insurance policies. They also have physical locations to maintain. This extra overhead means that traditional insurers, while a safe choice, are also on the more expensive side.  
  • Online insurers: Next and Tivly are examples of online insurers that have a web presence rather than a physical location and use AI instead of agents to sell policies. This digital-first approach lowers overhead considerably, and those savings are passed on in the form of lower premiums. If you’re looking to save money while maintaining quality, an online insurer is the best option. 

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Cost of General Liability Insurance

On average, creative agencies in America spend between $450 - $750 per year for $1 million in general liability coverage.

Compare the average cost of general liability insurance for a creative agency to other professional industries using the graph below.

Several factors will determine the price of your policy. These include your:

  • Location
  • Deductible
  • Number of employees
  • Per-occurrence limit
  • General aggregate limit

You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.

A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.

Graph showing average price of general liability insurance prices per industry

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Find the Best Rate

Discover the best coverage at the lowest rate in our cheapest business insurance review.

Common Situations That General Liability Insurance May Cover for a Creative Agency

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Example 1: While a client visits your office, she falls in the restroom due to inadequate lighting. General liability insurance would cover her medical bills for any resulting injury.

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Example 2: Because your business name is similar to another creative agency’s name, the other agency sues you for loss of income because it claims several of its clients mistakenly booked services through you. General liability insurance would cover your legal costs and any awarded damages.

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Example 3: You need to replace the hard drives in all of your computers after an IT employee makes a critical error. General liability insurance would pay to repair your damaged equipment.

Other Types of Coverage Creative Agencies Need

While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:

Commercial Property Insurance

If you own the building in which you operate, commercial property insurance helps protect your business-related property in the event of a fire, burglary, or natural disaster. It covers the cost of repairing any structural damage to your building or grounds as well as repairing or replacing any business materials you store there.

Professional Liability Insurance

Creative agencies give clients the direction they need to promote their products or brand. If a client believes the advice your company provided caused them to lose business, they may blame you for a loss of income. This insurance would cover your legal costs in the event of a lawsuit.

Workers’ Compensation Insurance

Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover but also any disability or death benefits stemming from a work-related accident.

Commercial Auto Insurance

Any vehicle you or your employees use primarily for business — such as to visit clients — requires commercial auto insurance to protect the vehicle, driver, and others on the road in the event of an accident. Be sure to select a policy that covers not only accident-related vehicle repair costs and medical treatment for anyone injured but also sufficient protection for any business-related equipment you carry in your vehicles.

Data Breach Insurance

If your business loses sensitive client information as a result of a cyber attack, this coverage would help pay to restore your computer network and compensate clients for any related financial losses.

Commercial Umbrella Insurance

While your general liability insurance policy covers most claims, some accidents or lawsuits may be so catastrophic that they threaten to exhaust the limits of your primary coverage. Commercial umbrella insurance protects you from paying out-of-pocket for any legal fees and awarded damages that exceed your primary policy.

Additional Steps To Protect Your Business

Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.

Here are several things you can do to better protect your creative agency:

  • Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
  • Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
  • Stay up to date with business licensing.
  • Maintain your corporate veil.

Creative Agency Business Insurance FAQ

Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.

A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.

"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.

Getting the right creative agency business insurance from the outset will help ensure the financial longevity of your business by protecting it from various types of financial liability or loss, such as personal injury suits or property damage.  

In addition, most states require every business to have workers’ compensation, commercial auto, and perhaps other types of insurance. 

Not necessarily. Certain exceptions may be written directly into your creative agency insurance policy, and some perils may be entirely uninsurable.

Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.

An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.