Life Insurance When You're Self-Employed

Setting up your own business can be an exciting time for many people. You are your own boss and you have no one to answer to. There are challenges involved though and there can be plenty of tough days ahead. Yet, there is usually something there that makes it all feel worthwhile. When starting out it’s important to consider how you might go about protecting the business. This also applies to your family and what they might do without you. It's important to remember that there are certain benefits that can come with working in a company.  


Why should I consider getting life insurance if I’m self-employed?


One of the more common benefits of working in a large organisation is the death in service benefit. This is a form of life insurance that is taken out by the company you work for. In the event of your death, it will pay your family a lump sum.


Unfortunately, being self-employed means you don't automatically have the protection that a large organisation could give you. If you were to die this could mean that any financial obligations you have could potentially pass to your family. This could mean that your spouse, your kids or even your parents could be liable for things like your debts or even a mortgage. Starting out you might have taken out personal loans. The extent of these loans does depend on the size of your business. Big or small though, it could be another financial worry for your family.


Should you consider getting Critical Illness Cover?


You may be thinking that life insurance on its own is enough of a cover for you and your family. When you decide to go out on your own you should think about making provisions to protect yourself. If you worked in a big company it is likely that you would be provided with an allowance for sick pay or pay if you were sick for an extended period of time. Working under your own business means that this protection may not be there for you.


Critical illness cover is there to help protect you if you suffer from a serious illness. As a result of a critical illness, you may need many weeks or months to recover. Payment is made to your family and it can help them cope with the loss of income from not working during that time. That means you can focus your energy on getting better.


What are my options for life insurance if I’m self-employed?


As far as life insurance with Choozi is concerned you have a few options.


Life Insurance


With this type of life insurance, you choose how long (the term) and how much (the benefit) you would like to be insured for. You may have seen this type of insurance referred to as ‘term’ life insurance. There is also the option to buy this as either a single or joint policy. 


Life & Critical Illness


This type of insurance is like a regular life insurance policy only you have critical illness cover added as well. This means that you have some financial support in place should you become critically ill or seriously injured. Choosing to add this type of cover works the same as getting regular life insurance. You choose how much you would like the policy to pay out and how long you would like to be covered for. 


The benefit amount is payable once i.e. following the first event (critical illness diagnosis or death). Once the policy has paid out for either event, your cover will end.


Mortgage Life Insurance


Mortgage life insurance, as the name might suggest, is for any of the larger loans you might have in your life. So this can be in the form of a mortgage but it may also come in the form of other bigger financial commitments. Again you select the term and the benefit and for how long you would like to be insured. The principal difference here is that the benefit will decrease over time. This reflects the fact that as you pay back that larger financial commitment it will get smaller over time. 


Choozi is here to support you


Making the decision to go it alone can be exciting and scary in equal measures. Choozi can help you make things a little easier and give you one less thing to worry about. With Choozi you can get access to quotes for all these insurance types in a matter of minutes. We work with the leading UK life insurance companies to provide you with a tailored quote. 


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