That is an inaccurate blanket statement. Liability can be controlled by the type of work you are doing and the contract you sign with your client.
Doing concept sketches and models does not open you up to liability, they are not a finished good.
If you are doing work on the finished good, it will depend on the the work. Packaging graphics for 14pt SBS ? What exactly is your risk?
Doing the final specifications? Sure, there can be risk, but again, it depends. You can have a contract releasing you from liability with your client. Of course a lawyer can sue you anyway, but if you did that work with a fortune 500 company and you are some schmuck with a 5-person office, trust me, the lawyer will ignore you while going after the deep pockets of your client.
As I wrote before, you need to balance the actual risk with the time and cost of incorporating. I can go to wally world and buy a helmet for $20 so if I fall while walking it will protect my head. But I won’t.