>As a small software developer (and I assume that most of you here belong to this group), do you carry a Business Insurance?

This used to be a practice when you had to perform onsite contract through a third-party firm, such as a recruitment firm you would represent at a client site. It also required you to be incorported. Then, those insurance policies cost over 10k. It took about a month, or more, of work just to pay that cost. It didn't really was viable. I haven't heard from that since a very long time.

Also, as you say, if it is a small software development shop, most won't be able to afford that.

See if you can manage a workaround. No one should really force you to have those insurance policies nowadays.