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I am self-employed and looking at my options for insurance if I am unable to work, what would you suggest I considered?

05 August 2022

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Question by Jeff

I am self-employed and looking at my options for insurance if I am unable to work, what would you suggest I considered?


Answered by Tarnia Elsworth

Hi Jeff,

Great question, thanks for getting in touch!

Most people that consider insurance start with Life Insurance, this is a cost-effective option and only pays out on death.

Statistically you are more likely to be ill or injured, and therefore unable to work, then you are to die.

As your income pays your bills, it is important that you think about what happens if your income stops.

Employees get access to Statutory Sick Pay which currently is £99.35 per week, arguably not enough to cover most people’s expenses. https://www.gov.uk/statutory-sick-pay

As you are self-employed, you don’t get access to this benefit. You would need to claim Employment and Support Allowance; https://www.gov.uk/employment-support-allowance/eligibility, this can be a fairly long winded process, and again the actual benefit payment is unlikely to cover your outgoings.

I would advise that you look at Income Protection, if you are the director of a Limited company, you should look at Executive Income Protection.

I wrote an article in November that takes an in depth look at Income Protection, and this may help give you a steer.

https://www.tpfinancialsolutions.co.uk/the-importance-of-income-protection

If you are unsure of the level of cover that you need, I would recommend that you speak to an adviser. These conversations should be fee free, and if you took a product based on the advice received, the adviser would receive a commission from the insurance company.

I really hope that helps. Do submit another question to Boring Money if you need any further assistance.

All the best
Tarnia
TP Financial Solutions

Answered by

Tarnia Elsworth

Protection Adviser

I am a down to earth, Lancashire lass, with a passion for helping people protect what they work so hard to build.