5 Things Self-Employed Individuals Need to Know About Personal Accident Insurance

5 Things Self-Employed Individuals Need to Know About Personal Accident Insurance

One of the most important forms of insurance cover a self-employed person can have is Personal Accident Insurance. This protects you financially if you are injured or become ill and cannot work for an extended period.

1.     What is Personal Accident insurance – it's an insurance policy that is renewed each year. It provides a pre-agreed weekly benefit (up to 85% of your salary) if you cannot work for an extended period due to an injury or become seriously ill (optional cover). 

The policy will also pay out a lump sum benefit if you cannot return to work or have a permanent disability, such as loss of an eye or figures. 

2.     Business Expenses – some insurers also offer the option to insure certain business expenses. Business Expenses insurance means that the fixed expenses of your business will still be paid even if you cannot work due to injury or sickness. 

3.     Flexible cover – you can choose the amount of weekly benefit and capital sum insured, which is the amount you are paid if permanently disabled or in the event of your death.  You can also choose the number of weeks as your waiting period, which is the time before you start to be paid benefits. The longer the waiting period, the greater the premium discount. 

4.     It is important to know that - most self-employed people cannot purchase workers' compensation for themselves, only their employees. Therefore, if there’s an accident at work or driving between job sites, there’s no payment for lost income or lump sum benefit. 

Personal Accident insurance is renewed each year, and the availability of cover and premium depends on your occupation, age, sum insured and claims experience. Insurance may not be offered on renewal if you have had a claim or are diagnosed with a serious illness. 

5.     Other types of insurance protection - Personal Accident Insurance is one type of insurance that can protect you and your business financially. 

Others include: 

  • Non-cancellable income protection or disability insurance is usually part of your life insurance and covers part of your usual income if you’re unable to work through sickness or accident.
  • Life insurance provides a lump sum or series of payments if you die.
  • Trauma insurance provides a lump sum if you have a specified life-threatening illness.
  • Business interruption or loss of profits insurance covers you if your business suffers from damage to property by fire, storm, etc. It can help you pay your ongoing fixed expenses and net profit.
  • Management liability provides financial protection, paying legal expenses or damages in the event of an actual or alleged wrongful act by a manager in the business.
  • Employee dishonesty covers losses from employee PR contractor theft or fraud.

Tangible Benefits

While the primary advantage of having disability insurance is income replacement, it also offers peace of mind, knowing that you're financially protected if injured. If you’re self-employed and haven’t considered personal accident insurance, now is the time to prioritise it. Contact us today to discuss this further.

General Advice Warning

This communication including any weblinks or attachments is for information purposes only. It is not a recommendation or opinion, your personal or individual objectives, financial situation or needs have not been taken into account. This communication is not intended to be a constitute personal advice. We strongly recommend that you consider the suitability of this information, in respect of your own personal objectives, financial situation and needs before acting on it. This document is also not a Product Disclosure Statement (PDS) or a policy wording, nor is it a summary of a particular products features or terms of any insurance product. If you are interested in discussing this information or acquiring an insurance product, you should contact your insurance adviser to obtain and carefully consider any relevant PDS or policy wording before deciding whether to purchase any insurance product.

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