5 Reasons You Should Have Business Insurance If You’re Self Employed
If you are one of the more than 10 million self-employed citizens in the United States, you may have questions with regard to how to properly insure yourself and your business. After all, not only is it imperative to protect your business, but many of the individual policies we have come to rely on are typically purchased through employer sponsored plans. Nevertheless, there are plenty of options for the self-employed to help cover all your insurance needs. Here are 5 reasons why you should consider a business insurance policy:
1. Ability to Join a Strong Network
Business insurance policies give you access to insurance policy networks made of other self-employed business owners. The purpose of these networks is to unite and assist self-employed freelancers and entrepreneurs with information and resources. Policies such as health insurance can be extremely expensive when purchased individually and outside of a network. Working within the framework of business insurance can give you access to affordable plans with favorable premiums and deductibles in the case of an emergency.
The National Federation of Independent Businesses (NFIB) provides an abundance of savings programs and insurance offerings to its membership. The National Association for the Self-Employed is another organization with a number of specialized insurance policies designed to protect self-employed workers.
2. Coverage Tailored to the Self-Employed
No two businesses are alike. Equipment needs can vary from company to company, as can the number of employees. Different companies must deal with potential liability claims specific to their business, and have a coverage plan suitable for that situation. Business insurance provides far more comprehensive and flexible coverage to safeguard your business from theft, damage, lawsuits, or interruption of services. This is particularly important than for the self-employed, whose needs completely diverge from the protection goals of traditional businesses.
3. Liability Insurance Coverage
Having business insurance means protection for yourself or your business in the event the company is liable for significant damages to a client or employee. Given the capricious nature of business and an increasingly litigious culture, liability insurance is an essential component of any business insurance policy. A single lawsuit can inflict irrevocable harm on a self-employed business, and liability insurance helps ensure that such a claim will consume both your enterprise and your personal assets.
4. Disability and Health Insurance
As a self-employed individual, being sick or disabled means the entire business comes to a halt. Consequently, having an insurance plan that provides funding for extended periods of disability is crucial for a self-employed individual. Moreover, many disability plans require a waiting period of six months before benefits are paid out. Business insurance plans can be altered to have a shorter waiting period to keep you solvent during a period of poor health. Keep in mind, however, that attenuating the waiting period will result in higher premiums.
5. Errors and Omissions Insurance
Business insurance provides additional liability protection for self-employed individuals in practices where errors and omissions can lead to litigation. Doctors, attorneys, financial advisers and even mechanics can be sued for negligence based on the advice they provide. Protecting your business with a business insurance plan is especially critical in these fields, given the amount of subjectivity that is mixed in with even the most informed opinion. A business insurance policy will analyze your experience level, the size of your business, and previous claims history before assigning you a premium. Although prices will vary, having proper coverage of Errors and Omissions (E&O) can be critical to ensuring the health of your career and personal finances as a self-employed worker.
Clive Goodman writes about about a wide range of business topics including public and employers liability insurance.


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