What about liability insurance? That depends on your business. If youre a service provider whos unlikely to get sued no matter how poorly you perform, such as a proofreader or graphic designer, you probably dont need insurance. We tell our bookkepers that every insurance agent will tell them they need errors and omissions insurance, says Mazzella. But weve never heard of bookkeepers being sued unless they stole from the business or committed fraud, and no insurance will cover that.If you sell products, you again have to evaluate your risk. If you sell bottle corks, your liability would probably be limited to replacing bad bottle corks, says Williams. If you mass-produce cherry jam, you have the liability caused by people getting sick on your jam or breaking their teeth on a cherry pit. You wouldnt want to self-insure that liability. Youd want product liabliity insurance.