Why Do I Need Insurance, If I am Self-Employed…

Smartchoice Editorial
April 16, 2020

Here are the best health insurance options for the self-employed…
You may wonder…why such an option might be needed…
Okay, so let’s analyze the situation here, You’ve abandoned your corporate or any other operational-mainstream-not-your- a dream job in Pakistan and now have decided to be your own boss.

Well done! You’re part of an army that is growing each day of self-employed workers.

Who can be categorized as Self-Employed?

As per the definition, a person who has a business for him/herself and that person provides his/her services out to other businesses/companies is considered self-employed. The terms in relations to this which you might also hear apart from the self-employed person referred to as an independent contractor or a freelancer.

The numbers of self-employed/people-who-are-their-own-boss are increasing rapidly with the rise in the culture of entrepreneurship and people being more and more invested in sponsoring in new and marketable and sellable ideas. In the US alone as per the Bureau of Labor Statistics, the government agency that tracks such things, it is estimated that 103 million Americans counting themselves as self-employed by 2026. That’s a 7.9 per cent increase. One of the world’s fastest-growing industries.

Self-employment and being your own boss also means that company incentives, such as health insurance, aren’t provided by the business. One needs to choose the best alternative for themselves to protect themselves against any foreseen mishap that may occur due to any situation and may arise at any given time.

The main question which arises now is that which insurance should be procured as an alternative, as it needs to be well thought and researched since it’s the only cushion a freelance worker can acquire on his end as a shield against adversity.
When you become your own boss, you need to be more vigilant and think about what will happen to you or your family if you are not working and you are not well as you have no sick leaves, casual or earned leaves to avail, every day is a working day and the more you wok the more you earn.

Few Questions that need to be kept in mind while shopping for your personal insurance…

  • What insurance will you need?
  • If you are running a business from home do you need insurance to cover you?
  • What insurance will you need? If it’s Personal insurance, which plan should you go for?

This guide will provide you with all the assistance and will help you work out what you need and where to get it from.
Their insurance buying also depends on the factor of personal preference and what coverage do you really require.

Many self-employed people usually consider income protection insurance and critical illness cover in case you get too sick or injured to work or get a serious illness. Life insurance is also a common option and possibility for those self-employed people who have dependents; they also have to provide for their family parents, partner or children.

There is a range of personal insurance plans varying on premiums and coverage’s worth considering if you’re self-employed or your own boss.

Health Care Policy

The health care policy is something that one has to have for regular health emergency; the health policy covers pre-and-post hospitalization, you might have had health insurance as part of your salary package if you were employed at a certain organization, this is one benefit added by many companies to retain their employs and their loyalty for a longer period of time.

You need to remember and keep this in mind that this insurance must have ended when your employment stopped with a certain organization; you need to procure health policy on your to cushion yourself against any uncertainty that will affect you more now due to you being more vulnerable to missing work and being hospitalized due to any illnesses.

You should contact your insurer and ask them about the coverage you were availing incorporate insurance tab, it would probably be expensive for your pocket but you should negotiate. If you can afford the premiums, which they quote it might be worth considering as it gives you a choice in the level of care you get and how and when it is provided as per your needs and requirement. Do check and bargain with the provider how much it would cost you to continue with the existing cover.

Personal Accidental Plan

It is a short-term policy and they support you during the times known as accident, sickness and even an unexpected death due to unforeseen circumstances. These personal accidental plans can be bought for the period of one year; the policy can be bought again after the insurance period ends. The personal accidental plans are designed to cover any outstanding debts you have, cause of the lump-sum cash benefit it would not only help in paying the debt but other financial burdens as well.

Critical Illness Cover

The critical illness provides you with a lump sum of financial compensation if you are diagnosed with one of the serious illnesses covered by your policy. These usually include some cancers, heart attack and stroke.
The cover is designed to help you pay off debts, or a bank loan, or pay for any amendments needed to be done to your home – for example, after any such ailment if you want to use a wheelchair. Only some of the pre-determined conditions are covered in the critical cover. Common and not so high-risk illnesses that can keep people off work for a day or two or something such as back problems and stress are not covered in the critical illness plan. Critical illness is different from the personal accidental plan or Term life plan as it pays only upon being diagnosed with certain determined illnesses and does not provide any monetary compensation to the relatives in case of death.

Life insurance

Whole life insurance or simply known as life insurance is the most simple and most acquired kind of insurance, it is provided by multiple insurers providing many benefits which have payment of 3times or 4times more than the invested money, accidental death complete benefit to the next of kin etc.etc. This insurance will usually pay your dependent relatives and children a lump sum, but one thing that needs to be kept in mind while signing up for such policy is that it’s a long term commitment, the money needs to be paid regularly ( the agreed instalments by both the participant and the insurer), the best time to start is when you set-up your own business so you can attain the maturity period during the given time.

There are multiple plans under the ambit of life insurance you need to do extensive window shopping for the right insurance plan before you settle on one you want to continue with. One tip: book a plan and an instalment that is payable by you rather than going for something that maybe is difficult to take up and make the ends meet.

Term Life Insurance

As it is wisely said: “In business (and life) there are some things you can’t control or predict”

Running your own business and being the sole bread earner for your family means that your spouse and children rely on you for themselves on the income you make from your business, your dependents need to know and have the satisfaction that they’re covered financially if you die unexpectedly or suddenly. It’s not fun and it is gloomy to think about such thing, but one thing that you might never want for your family is for them to wonder how they’ll put food on the table or keep the lights on after you are gone. You need to understand well before the time that the stakes are high and that’s where the term life insurance makes it way and protects your loved one’s future.

One important job that Life insurance or term life has is only: It replaces your income when you die and helps your family to make through this difficult time.
What are the technicalities of term life insurance is that it is a life insurance coverage for a specific amount of time like 1 year (12 months) from the date procured and if you die (God forbid) during that term, your family will receive a payout from the insurance policy depending on the procured plan the coverage can start from as low as PKR2100 and coverage can go up to PKR1500, 000.

It’s far less expensive and budget-friendly insurance and by far the best value insurance than whole life insurance and other types of insurance. It’s the best and only way to go forward!

Some perks of being self-employed…

Well as your responsibility towards yourself and your family along with the other things becomes more, the power to assert your own discretion also increases. One of the best ways is that you get to control how you do business, how you set-up things, what hours and how many of them to put in while working and the most amazing is to pick and choose whom you want to work with, so it’s no brainer that more and more people are going towards self-employment and working towards the realization of their dreams to be an entrepreneur and live their reveries.

But…with great power comes great responsibility…

As the members in your team increase, you should be concerned about their wellbeing as well and provide them with due health policy for the sub-ordinates and yourself. Take care of all the if’s so your entrepreneur’s dream does not turn into a nightmare. You’ve worked too hard to leave anything unprotected! The insurance will bring you peace of mind.

One important Tip!

Before finalizing any insurance plan, do contact Smartchoice.pk they are the pro when it comes to procuring insurance, whether its individual, family or your small business team, Smartchoice.pk would get you best rates and best coverage as per your needs and requirements for you and your team of workers. You may have a team of five or fifty when you work with Smartchoice.pk it would facilitate you with best plans with zero % service charges or facilitator charges.

You might ask…why Smartchoice?

Well…It’s a great idea to sit down with an independent aggregator, who can help and guide you and assist you in understanding your options and find the best plan for your budget and your and business needs. They can help you find the best deals and the right coverage for you!

Conclusion


We should always remember that life is unpredictable and circumstances change, in this situation of things being dynamic and constantly changing. Being responsible you should ensure that you have the right insurance coverage for the right time ad need, for instance, you have your health insurance active for your any medical emergencies and whole life insurance or term life insurance for different needs for you and your family.

It doesn’t matter if you’re a fixtures contractor or a freelance journalist, there’s always risk involved with your job. Some people are more likely to get injured on the job while others might be at risk to get a claim slapped on them.

We know trying to figure out all the details involved with self-employed insurance can be overwhelming. You need an expert who can answer your questions and help you find out exactly what kind of insurance you need and compare rates so you can find the best policies for you.

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