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How insurance and the gig economy have evolved from the Stone Age — really

Risk management is as old as civilization. Today’s gig workers have multiple ways to maneuver it.

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After a decade-long hiatus, the Bureau of Labor Statistics finally released new numbers on the gig economy in 2018, confirming that there are at least 10 million independent workers in the United States. Compare that to the 12 million in manufacturing and the 3 million in public teaching, and this number doesn’t seem so small. Make no mistake: The gig economy is real, and it’s here to stay. But gig work comes with a lot of risk. Today’s gig workers can look back at a whole lot of history behind risk-taking and mitigating.

People have found ways to take and maneuver risk since the hunting groups of yore.

Gig workers take chances at every step, tackling risk head-on. But they’re not the first to do it. Go back tens of thousands of years when hunter-gatherers tracked animals like elk for meat. They hunted in groups to protect one another and spread out the risk of being killed by the animals’ dangerous antlers. It was the same idea with tradesmen who divided their goods among different caravans so they could lessen the risk of all their cargo being stolen by thieves.

Then there was the Code of Hammurabi, one of the oldest written legal frameworks on the planet. Its 282 laws included several rules related to risks. One stated that debtors hit with crises like floods, disability, and death didn’t have to pay back their loans. Another outlined how engineers who built houses that caused damage to the owner’s goods would provide compensation and rebuild the structure. These were like forms of insurance against uncertainty.

Many medieval guilds required members to pay dues, which were stored in large coffers. If ever a fellow craftsman were robbed, disabled, or killed, the guild would use this pool of money to help rebuild or take care of families. Such insurance against risk encouraged more people to leave the agricultural sector for trading. And it continued. Risk-taking and new ways to mitigate risk carried us through history, protecting us as we explored new worlds, developed new ways to travel, and constructed new homes.

The gig economy is changing the workforce, but history should remind independent workers how to manage their risks.

Risk-taking isn’t a new phenomenon, and neither is gig work. People have been managing their own businesses and working independently for a long time. Actors in the entertainment industry, freelance writers, those employed in trade work like plumbing — these are everyday members of the workforce who often work for themselves. But the gig economy of today stands out because of its prevalence with technology and within the middle class.

“The fact that you don’t have to be on location in order to work effectively as part of a team, and the fact that you can go onto any number of platforms to find work makes it much more efficient and easier. It removes a lot of the friction,” explains Diane Mulcahy, the author of The Gig Economy. “The other thing that’s different is that the gig economy has very quickly moved into what are traditionally middle-class and knowledge and professional jobs. And I think that’s one of the things that’s driving the massive discussion about it.”

As the gig economy transforms and Americans continue to join its ranks, it’s become increasingly apparent how much risk goes into it. But there are smart ways to take note from history, find ways to mitigate the risks involved, and flourish as a real entrepreneur. Professional liability insurance is one way gig workers can manage any risk to their work and livelihoods. See the video above to learn more.

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