Most side hustles in Canada are not covered by your existing home or tenant insurance. The Financial Consumer Agency of Canada says plainly that “home insurance isn’t business insurance,” that you must notify your insurer if you run a home-based business, and that using your home for purposes your insurer is not aware of may cancel your policy (FCAC). Whether you need a separate policy depends on what could go wrong: a client tripping in your home, damage at a client’s house, or a mistake in advice you were paid for. For many local service side hustles, liability insurance is a reasonable early cost; for low-risk online work, telling your home insurer and checking your equipment cover may be enough.
The startup cost guides price insurance for specific hustles, such as dog walking, handyman work, and house cleaning. This guide explains the coverage types so you know what to ask for. It sits with simple freelance contracts and registering a sole proprietorship in the admin set.
Does home insurance cover a side hustle in Canada?
Generally not, beyond a small amount of equipment cover. The FCAC says home insurance generally won’t cover claims related to a home-based business, and that the policy may give only limited cover for business equipment while it is in your home. It lists what home insurance won’t cover:
- stolen or damaged equipment or tools while in your vehicle or outside your home
- injury to a client while visiting your home (personal liability)
- equipment damaged in your home while used for business purposes, beyond any limited cover
The Insurance Bureau of Canada adds that personal liability on a homeowner’s policy “would typically not cover” bodily injury or property damage claims from a home business, and that professional liability isn’t covered under a home policy (IBC).
What types of business insurance should a Canadian side hustler know?
Three types come up for most side hustles. The IBC’s types of business coverage page describes each.
| Coverage | What it protects against | Side hustles that often ask about it |
|---|---|---|
| Commercial general liability (CGL) | Amounts you are legally obligated to pay for bodily injury or property damage to others, plus legal defence costs | Handyman, house cleaning, dog walking, pressure washing, snow removal |
| Professional liability, or errors and omissions (E&O) | Claims from professional negligence, such as inaccurate advice that causes a client financial loss | Bookkeeping, web design, AI consulting, personal training |
| Home business insurance | A separate policy or add-on for a business run from home, including equipment and liability | Home baking, Etsy shops, home-based tutoring |
The IBC notes that professional liability may be offered through professional associations, and that the definition of “professional” varies by insurer, so ask how your insurer classifies your service. It also covers commercial vehicle insurance for vehicles used in a business; if you drive for clients or apps, ask your auto insurer whether your policy covers that use.
How do you get side hustle insurance in Canada?
Through an insurance broker, an insurer that sells small business policies directly, or a professional association that offers group coverage.
Step 1: Tell your home insurer
Even if you buy nothing else, the FCAC says you must notify your insurer of a home-based business. Ask what, if anything, your current policy covers.
Step 2: List what could go wrong
The IBC suggests asking: what can go wrong, what will I do to prevent it, and if something happens, how will I pay for it? Write down your services, where you work (your home, client homes, online), and your equipment’s value.
Step 3: Get two or three quotes
Give each broker or insurer the same description. Ask about the liability limit, the deductible, exclusions (for example, work at heights or with pets), and whether clients can be added as additional insureds.
Step 4: Match the policy to client requirements
Some clients, property managers, and platforms ask for proof of liability insurance before you start. Ask for a certificate of insurance once the policy is active.
Step 5: Review it as you grow
The IBC recommends reviewing coverage with your insurance representative as your business evolves, such as when you add a service or hire help.
What insurance mistakes do Canadian side hustlers make?
The costly ones are assumptions.
- Assuming home insurance covers it. It generally doesn’t, and silence can put the home policy itself at risk.
- Assuming a platform covers you. Some apps provide limited coverage while you are on a task; read the platform’s own terms rather than assuming.
- Buying the wrong type. A bookkeeper’s risk is advice (E&O); a cleaner’s risk is damage and injury (CGL).
- Forgetting tools in the car. The FCAC and IBC both note that equipment stolen from a vehicle is not covered by personal home or auto policies.
- Not reading exclusions. Ask specifically about the riskiest thing you do.
Is side hustle insurance tax deductible in Canada?
Generally yes, when it is for the business. The CRA’s business expenses page says you can deduct ordinary commercial insurance premiums on buildings, machinery, and equipment used in your business, while insurance on a vehicle is claimed as a motor vehicle expense and insurance on a home workspace goes in business-use-of-home expenses. See side hustle expense deductions and home office expenses. Track premiums with your other costs, for example in FreshBooks TODO-AFFILIATE.
This is not tax, legal, or insurance advice. Speak with a licensed insurance agent or broker about your specific situation.
Which guides sit next to side hustle insurance?
Simple freelance contracts, separating business and personal money, side hustle expense deductions, and registering a sole proprietorship. For platform-specific coverage, see the Rover review, TaskRabbit review, and Amazon Flex review; regulated professionals should read side hustles for nurses and side hustles for tradespeople.
What are the common questions?
Does my home insurance cover my side hustle?
Generally not. The FCAC says home insurance isn't business insurance, that you must notify your insurer of a home-based business, and that home policies generally won't cover client injuries at your home or equipment away from home or in your vehicle.
What is commercial general liability insurance?
Commercial general liability covers amounts you are legally obligated to pay for bodily injury or property damage to others, plus the legal cost of defending you, according to the Insurance Bureau of Canada.
Do freelancers need errors and omissions insurance?
Freelancers paid for professional services or advice may need professional liability, also called errors and omissions, insurance. It covers claims of professional negligence, such as advice that causes a client financial loss.
Is side hustle insurance tax deductible?
Ordinary commercial insurance premiums for the business are generally deductible. Vehicle insurance is claimed as part of motor vehicle expenses and home insurance for a workspace as part of business-use-of-home expenses.
Where do I buy insurance for a small side hustle?
Through an insurance broker, an insurer that sells small business policies, or a professional association with group coverage. Get two or three quotes using the same description of your work.
Which sources support this guide?
The rules, rates, and platform requirements in this guide are checked against these primary sources. Retail price ranges are labelled as ranges to verify locally, and they are not quotes.
- Home insurance — Financial Consumer Agency of Canada
- Types of business insurance coverage — Insurance Bureau of Canada
- Business expenses — Canada Revenue Agency