Every Essential Insurance For The Self-Employed

Shawn Plummer

CEO, The Annuity Expert

If you’re self-employed, you’re responsible for your financial well-being. That means you must protect yourself and your assets against unexpected events such as accidents, injuries, illnesses, and natural disasters. Therefore, insurance is a must-have for any self-employed person. Insurance policies will help you manage the financial consequences of unexpected events and provide peace of mind knowing you are covered. In this guide, we will discuss every essential insurance for the self-employed.

Health Insurance

Your health is your most valuable asset, and taking care of it is essential. Unfortunately, as a self-employed person, you don’t have the luxury of relying on an employer to provide health insurance. That means you need to purchase your health insurance policy. A health insurance policy will help you pay for medical expenses such as doctor visits, hospital stays, and prescription medications.

Individual Health Insurance

Individual health insurance policies are purchased by individuals or families rather than provided by an employer. Several individual health insurance policies exist, including HMOs, PPOs, and catastrophic coverage. HMOs typically have lower premiums but require choosing a primary care physician and getting specialist referrals. PPOs give you more flexibility in choosing doctors and specialists but have higher premiums. Finally, catastrophic coverage is designed to protect you in the event of a significant illness or injury.

Short-Term Health Insurance

Short-term health insurance policies are designed to provide coverage for a limited period, usually six months to one year. These policies are typically less expensive than traditional health insurance policies but have limited coverage.

Every Essential Insurance For The Self-Employed

Disability Insurance

As a self-employed person, your income is your livelihood. If you were to become disabled and unable to work, you would lose your source of income. Disability insurance can help replace a portion of your income if you become disabled and unable to work.

Short-Term Disability Insurance

Short-term disability insurance covers a limited period, usually three to six months. These policies typically have a waiting period before benefits kick in, and they provide coverage for a percentage of your income.

Long-Term Disability Insurance

Long-term disability insurance provides coverage for an extended period, usually until you reach retirement age. These policies have a waiting period before benefits kick in, and they provide coverage for a percentage of your income.

Liability Insurance

As a self-employed person, you are responsible for any damages or injuries you cause to others. Liability insurance can help protect you from financial liability in an accident or injury.

General Liability Insurance

General liability insurance covers damages or injuries caused to others due to your business activities. This can include property damage, bodily injury, or advertising injury.

Professional Liability Insurance

Professional liability insurance, or errors and omissions insurance, covers damages or injuries caused by errors or omissions in your professional services. This can include things like malpractice or negligence.

Property Insurance

As a self-employed person, you may have assets such as a home, car, or business equipment that must be protected. Property insurance can help protect your assets from theft, fire, or other disasters.

Homeowner’s Insurance

Homeowner’s insurance covers your home and personal property during theft, fire, or other disasters.

Business Property Insurance

Business property insurance covers your business property, including equipment, inventory, and supplies. This can include things like computers, furniture, and inventory.

Auto Insurance

Auto insurance provides coverage for your car in the event of an accident or theft. This can include liability coverage for damages or injuries to others caused by you, as well as collision and comprehensive coverage for damage to your vehicle.

Commercial Auto Insurance

Commercial auto insurance provides coverage for vehicles used for business purposes. For example, suppose you use your vehicle for business purposes. In that case, you may need to purchase a commercial auto insurance policy to ensure that you are fully covered in the event of an accident.

Life Insurance

As a self-employed person, you may not have the same benefits as someone who works for a company, such as life insurance. However, life insurance is still essential for anyone who wants to protect their loved ones in the event of their death.

Term Life Insurance

Term life insurance covers a specific period, such as 10, 20, or 30 years. This type of policy is typically less expensive than permanent life insurance but does not accumulate cash value.

Permanent Life Insurance

Permanent life insurance provides coverage for your life and accumulates cash value over time. This type of policy is typically more expensive than term life insurance but provides more comprehensive coverage.

Next Steps

Protecting yourself and your assets against unexpected events is essential as a self-employed person. Insurance is a must-have for any self-employed person, and there are several types of insurance policies to consider, including health insurance, disability insurance, liability insurance, property insurance, and life insurance. By taking the time to understand your insurance options and choosing the policies that are right for you, you can help ensure that you are fully protected in the event of an accident, injury, illness, or natural disaster. Remember, insurance is an investment in your future, so you must ensure you have the coverage you need to protect yourself and your assets.

Insurance For The Self-Employed

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Frequently Asked Questions

What insurance does the self-employed use?

For self-employed entrepreneurs, a Business Owners Policy (BOP) is the ideal starting point for any comprehensive insurance plan. Not only does it include three essential coverage types (general liability insurance, commercial property insurance, and business interruption insurance), but it’s also more cost-effective than purchasing each type of coverage separately.

Do I need insurance if I am self-employed?

Employers’ liability insurance may be unnecessary if you work as an independent contractor. However, other types of coverage might prove invaluable; thus, it is essential to consider taking out public liability, product liability, or professional indemnity insurance policies.

Do self-employed pay employment insurance?

Starting the year you sign up, your premiums will be based on your self-employed income for the entire calendar year. The rate is $1.63 per every $100 earned and caps off at a maximum of $1,002.45 in 2023 if you’re from anywhere else other than Quebec; however, those residing in Quebec have it slightly easier with only needing to pay out an amount of no more than$781.05 for each corresponding yearly period ending in 2023!

What is income proof for self-employed insurance?

To provide proof of income, you may need to submit a combination of documents, such as your latest tax returns, payslips from an employer (for public sector workers), and recent employment letter contracts. A CA’s certificate demonstrating the past three years’ earnings will likely be essential if self-employed or salaried. In addition, the insurer may require other standard documentation for further verification.

Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed insurance agent and annuity broker with over a decade of first-hand experience. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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