Insurance for Self-Employed People?

The decision to move away from a world of salaries and paid holidays towards being self-employed, particularly from home, can be a wonderful, scary, liberating and terrifying experience all at once. However, the perceived joys of being self-employed – leisurely breakfasts, the lack of a morning commute – can sometimes be overtaken by the almost overwhelming regulations and legal requirements that come with being self-employed. Self-discipline becomes essential and many self-employed people find themselves working even longer hours than previously, in order to make sure their income does not drop below necessary levels. Along with self-discipline and the realisation that all the responsibility for your own income now lies purely on you, comes a wealth of forms to be filled in, and decisions to be made about insurances: how much should you have, is there a legal requirement for insurance that your line of work demands, and what, if any, insurances can you get away with not having, in order to keep costs down?

Public and Employers Liability Insurance

If your business brings the public into direct contact with you, this is one insurance that is vital. While not a legal requirement, public liability insurance covers you, and the business that you are nurturing, in the event that a dreadful accident or error occurs on your premises. This insurance will pay up to a certain sum, named when setting up the policy, and gives complete peace of mind to a small company, sole trader or self-employed person.

If you employ anyone to help you with your business, this insurance protects in the event that they are made ill through the work, or suffer an injury or accident and are then unable to work, even if only temporarily. It is a legal requirement for an employer to take out employer liability insurance if they have an employee, and this policy covers the employee, even if the reason for claim is found to be negligence on your part – although adherence to basic health and safety rules is strongly encouraged!

Office Insurance

Even if you work from home, it is worth speaking to your insurer about some form of premises or office insurance, specifically tailored for business purposes. Many insurers feel vindicated in refusing a claim for office based damage or injury in the event of the existing policy only referring to home insurance. A policy describing the ‘office’ section of your home and covering any contingencies that might occur at work will work to give you peace of mind as you set about building your business.

Insurance is, sadly, one of the first things to be cut when drawing up a strict business budget. By all means, no-one wants or needs to spend money that they do not have to, but it can be a false economy to cut back too much. Make sure that you are fully aware of your legal requirement for insurances and after that give careful consideration to reasonable scenarios that could play out during the course of a business month – if you are absolutely certain that you can cope with any emergencies that crop up, you are probably well covered. If not, perhaps it is time to call your local friendly insurance broker?