Life Insurance for the Self-Employed
Congratulations on branching out on your own to continue a dream or provide a service that others will benefit from. Being a self-employed professional will have a specific need or requirement when it comes to a Life Insurance policy. To help you avoid the pitfalls and find the best policy that fits your needs simply follow our simple guide.
Being self-employed can certainly come with a lot of different perks and benefits. You have the freedom to work on your own terms, manage your own schedule and the new income potential for you and your family are all great. However, the freedom of freelancing or running your own enterprise is not always worry free.
A common concern for self-employed professionals is the fear of financial stability for themselves and loved ones, which without a pension or a claim payment from an employer for Death in Service cover if they were to pass away unexpectedly.
That is why many self-employed, contractors and directors people obtain a Life Insurance policy for the future. But with so many different options and policy variations available, how can you be sure that you’re getting the right cover at the best price?
In today’s guide we answer the following important questions:
Can I Get Life Insurance Cover If I’m Self-Employed?
How Do I Find The Best Self-Employed Life Insurance Policy?
Life Insurance For Company Directors
Is Company Director Life Insurance Affordable?
Can I Get Life Insurance Cover If I’m Self-Employed?
The simple answer is yes you can, in 2023 the UK’s working population consists of approximately 4.2 million self-employed workers, over the last 5 years at Life Insurance Cover we have noticed an increase from self-employed workers looking for Life Insurance and other forms of protective Insurance.
Depending on the individual’s type of self-employed work can mean that they may gain even greater benefits from different types of protective cover including Income Protection Insurance or Critical Illness Cover. These policy types can pay out a lump sum payment if a policy holder becomes too sick or is unable to work due to injury or long term illness.
However, although it is extremely important to ensure that as a self-employed person you have the right balance of personal Insurance, it is also important protect the potential future for your loved ones. Many of the self-employed professionals who come to us at Life Insurance Cover want ensure a greater level of financial cover for the future and peace of mind know that their loved ones will be financially supported if they pass away.
How Do I Find The Best Self-Employed Life Insurance Policy?
As a self-employed worker one of the most valuable commodities you have is time, which could be used to increase your earnings, brand or even send out invoices. By using an FCA regulated broker, like Life Insurance Cover, you could save a lot of time and money because our experienced team of advisors can quickly find the best policies for you. Our team of experts can identify and compare all of the UK Life Insurance companies which can provide you with the most beneficial cover for the best price available in one simple search.
Some people turn to online comparison websites to try and find the best deal but, however, these rarely provide an accurate Life Insurance quote because they work to very rough guides and are unable to take into account the individuals personal circumstances.
For an effective and accurate Self-employed Life Insurance cover quote a provider will need to ask a few standard questions about your health, medical history and personal circumstances. Once the details have been provided an Insurer will be able to provide an accurate quote on your individual needs and budget.
To help you avoid having to apply to multiple Life Insurance companies and compare each different policy and the different costs involved, simply use an experienced FCA regulated broker like Life Insurance Cover to find the right policy for you and your loved ones.
Our team of advisors can calculate your costs for you, save you the hassle of researching and comparing quotes and ensure you’re getting the absolute right cover at the best available price.
Are There Different Types Of Self-Employed Life Insurance?
When looking to purchase a policy there are two different types of Life Insurance to choose from and self-employed individuals are able to choose either type similar anyone else wanting to protect their family’s future:
Term based cover: This policy type of policy has a mutually agreed time period, once this date is reached the Life Insurance policy ends. A term based policy can start from your 18th birthday and provide cover until the day before your 90th birthday. If you pass away within the policy term, your family will receive a claim payment. However, if you pass away after the agreement date, no protection will be provided. A term based policy is usually the most cost effective policy type as it only covers a specified period of time.
Whole of life cover: This type of policy is provided to protect you throughout the life of the policy holder, as long as the terms and conditions of the policy are upheld and the monthly premiums are paid on time. A new Whole Of Life Insurance policy can be purchased by anyone prior to their 81st birthday and will provide cover for the future. This type of cover can be more expensive when compared with a Term Based Life Insurance policy but the price reflects the level of financial protection that this policy type can pay out.
Life Insurance For Company Directors
Many companies provide benefits to their employees including pension contributions, death in service, health Insurance which will all make a claim payment to the employee or their families. As a company director, you may not have considered how a Life Insurance policy, or a lack of it, could impact you and your family financially.
Without the safety net of a death in service claim payment, many business owners opt for their own personal Life Insurance policy, but by making this choice could mean you may miss out on potential tax benefits.
Is Company Director Life Insurance Affordable?
If you are a company director and pay for a Life Insurance policy through your company instead of out of you taxable personal income you could save approximately 50% of the cost, this could total thousands of pounds over the length of a Life Insurance policy.
By choosing to set up a Relevant Life Policy, paid for directly by the company for the director or directors, means the monthly/ annual premiums should be an allowable business expense and the company can claim corporation tax relief. When choosing to set up a Relevant Life Insurance policy can avoid paying National Insurance on the premium amount because it is paid for by the company and not out of your taxable personal income.
To learn more about Life Insurance for limited company owners and tax deductions, simply complete our easy use, no obligation free quote form.
Is A Life Insurance Policy Tax Deductible?
Depending on your individual circumstances it may be possible to deduct the cost of your Life Insurance policies through your tax return if you own a limited company or are self-employed individual.
An increasing number of business owners and self-employed professionals are choosing to obtain a Life Insurance policy through their business, this is because they can claim it as a justified business expense.
For many business owners and self-employed workers this can provide a great sense of relief knowing that they can protect themselves for the benefit of loved ones and also save money.
It is important to note that, as a business owner, you can prove that the purchase of Life Insurance policy was wholly and exclusively for the purposes of trade, you should be able to claim it as an allowable business expense which can help to reduce your tax bill.
Can Contractors Get Life Insurance?
In the UK, there are more than of 2 million full-time contractors in 2023, each of these individuals are working and supplying their goods and services in return for income. Like many other self-employed professionals, many contractors worry about how their families would cope if they were unable to work due injury, illness or if they pass away.
Many contractors choose to provide financial security for their children or loved ones for the future by obtaining Income protect policies and Life Insurance.
In the event of your death, a contractor Life Insurance can be used by your loved ones to:
Pay off a mortgage.
Settle outstanding debts.
Pay further education fees.
Cover funeral expenses.
The monthly premium costs for a contractor Life Insurance policy can be paid personally although depending on your circumstances it may be possible to deduct the cost through your business.
To find out more about a contractor Life Insurance, speak to an FCA regulated broker, like Life Insurance Cover who can search all of the policies available in the UK. Helping you to compare the market to find you the best level of cover at the most competitive price available.
Where Can I Get Impartial Advice On Self-employed Life Insurance?
Fortunately there are many Life Insurance providers who are able to offer exactly the right cover for your individual needs and monthly budget.
By using an FCA regulated broker, like Life Insurance Cover who Compares Life Insurance Quotes from all of the UK providers. You can be reassured that obtaining a Self-employed Life Insurance policy could not be easier. Life Insurance Cover is a whole of market broker who is not tied to an individual provider, helping you to find the most cost effective policy and best protection for you and your family for the future.