For many people who are self-employed, it’s all about the independence: the freedom to work your own hours, choose your own clients and er, file your own tax returns!
While working for yourself can be challenging, it also offers opportunities you won’t find anywhere else, and it’s this that makes being your own boss such an attractive option for so many.
However, with great freedom comes great responsibility and if you are self-employed you will need to arrange many things that regular workers take for granted. One of those things is health insurance: while some employers offer a comprehensive private insurance package as one of the perks of working for them, there’s no such luck for those who work alone.
If you work for yourself, it’s more important than ever to look after yourself: after all, you may not have the luxury of giving yourself sick pay if you’re too ill to keep earning and clients may become impatient and turn elsewhere – even if you have a legitimate reason for being unable to finish a project. When you’re a one-man band, illness is something can’t afford.
Of course, in the UK we are lucky enough to have discount healthcare provided by the NHS – but care isn’t always available when we need it, and the potential to come up against a long waiting list when you need treatment now can be more than an inconvenience when you’re self-employed – it can be a risk to your business.
That’s why one of the options worth considering is private health insurance, which can help you to get access to medical treatment when you need to, and get back to work as soon as possible.
Some health insurance plans will also include provisions for sick pay, so you recover lost earnings when you’re unable to work. It also gives you more flexibility about the times and places you receive treatment, something you’re unlikely to get with the NHS, but can be critically important if you work for yourself and can’t schedule your time around hospital appointments.
There’s some good news here too – self-employed people tend to get favourable deals with insurers, as they are less likely than ordinary employees to make a claim, so you may find you qualify for discounted cover.
Are there tax advantages?
If you are incorporated and pay yourself through dividends, you can also get some tax advantages as a self-employed person. If you offset the cost of your health insurance premiums against the profits of your business, you will only have to pay tax on the value of your medical insurance as a benefit in kind – something that can reduce your costs even further.
Of course, incorporation isn’t for everyone and this certainly shouldn’t be the only reason to do it – but if you’re already incorporated or are considering doing so, this is something to bear in mind.
What kind of cover to get
Medical insurance needs to be tailored to your circumstances. Some people simply opt for a generic policy that seems to suits the majority of people, but this isn’t really the most effective way to go about it – especially if you have a unique working situation.
The best health policy is one that is as customised to your needs as possible, taking into account things like your working hours, previous conditions, whether you spend a lot of time working abroad or on the road. All of these things can affect your health and the cover you need, and your policy should reflect that. Take a look at Health-on-Line for an example of how you can build your own personal or business health insurance plan according to your circumstances.
Balancing the cost
Being self-employed can be challenging at the best of times, especially in the current economy. Every decision involving a cost needs to be weighed against the potential benefits. But you might think of it like this: when you’re self-employed, you’ll almost certainly insure your workplace or premises along with any business-critical equipment, so that you can carry on with your business as quickly as possible if disaster strikes. Health insurance has the same benefits, minimising the disruption caused by any illnesses.
Who to go with?
There are a great many insurers out there to choose from, and they all offer slightly different things. The main things to look for in an insurer are:
- clarity of cover (you want to be certain you are covered for the conditions and eventualities that you think you are),
- a straightforward claims procedure (look for companies who are highly regarded for their customer service), and
- a good price.
With a bit of research, you should be able to find a flexible plan that works for you and your budget.