Income Protection for Self-Employed [Quotes from 20p-a-day]

Q: Can you get income protection you are self-employed?

Yes, you can take out an income protection policy if you’re self-employed. In fact, income protection can be particularly beneficial for those who are self-employed and don’t receive traditional sick pay benefits. The tax-free monthly payments you receive can help to keep you afloat financially while you’re unable to work due to illness or injury.

Q: Can I get income protection if I’m self-employed?

Yes, you can get income protection insurance if you’re self-employed. In fact, income protection can be particularly beneficial for those who are self-employed who don’t receive traditional sick pay benefits from an employer. During periods of ill health or injury, many self-employed workers could miss out on vital income, need to rely on government benefits to get by financially or face going back to work before a full recovery has been made. If you were unable to work for an extended period, could you afford to keep up with your bills and living expenses?

Q: What is executive income protection for self-employed?

Executive income protection can be taken out by self-employed directors of their own limited company. Through an executive income protection policy you could choose to cover any employee. This could allow you to cover your own income, or it could allow you to provide financial protection to an employee within your business. As executive income protection is taken out and paid for by the business, the premiums could be classed as a business expense making them tax deductible for the business owner. Executive income protection key points: Up to 80% of the insured employee’s earnings could be protected Cover if you become ill or injured Monthly premiums could be claimed as a business expense Monthly payments (for the insured employee) could be subject to income tax and national insurance Available through the advised team at Reassured

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Income protection for self-employed

Can I get income protection if I’m self-employed?
Why is income protection important for the self-employed?
How does income protection work for self-employed?
Does being self-employed affect income protection?
What is the best income protection for self-employed?
What is personal income protection for self-employed?
What is executive income protection for self-employed?
How much is income protection for self-employed?
Self-employed income protection FAQs

Self-employed income protection [Quick summary]

You could receive monthly, tax-free, payments to replace your income while you’re unable to work due to illness or injury
Self-employed income protection refers to a standard income protection policy taken out by someone who’s self-employed
As of July 2024, there were around 4.24 million self-employed workers in the UK^[1]
If you’re a self-employed director of a limited company, you also have the option of an executive income protection policy
Only 6% of self-employed workers have an income protection product in place, compared to 16% of those in employment^[2]
Explore your protection options as a self-employed worker through Reassured

Can I get income protection if I’m self-employed?

Yes, you can take out an income protection policy if you’re self-employed.

In fact, income protection can be particularly beneficial for those who are self-employed and don’t receive traditional sick pay benefits.

The tax-free monthly payments you receive can help to keep you afloat financially while you’re unable to work due to illness or injury.

Reassured can help you find the right self-employed income protection policy to meet your needs, at the best available price.

Through our advised team you can compare quotes from the whole of the market and receive personalised recommendations for your circumstances. Get in touch today for your fee-free quotes.

Compare Income Protection for Self-Employed »

Why is income protection important for the self-employed?

Here are 5 reasons income protection can be important for the self-employed:

No sick pay - As a self-employed worker, you won’t benefit from sick pay to help you financially while you’re off work. An income protection policy can act as a form of sick pay by proving you with a percentage of your income until you can return to work.
Limited government support - While you may have access to ESA (Employment Support Allowance), the amount you receive is unlikely to provide enough financial aid for you and your loved ones (up to £71.70 per week for those under 25 and up to £90.50 per week if you’re aged 25 and over^[3]).
Make a full recovery - 17% of self-employed workers would carry on working despite illness or injury^[2]. With income protection, you have peace of mind that you can take the time off that you need.
Long term cover - Cover can be taken out on a long term basis to provide protection for the rest of your working life if your illness/injury means you’re unable to return to work.
Protect your lifestyle - 19% of UK workers said they would struggle to pay their mortgage or rent if they were unable to work for 2 months due to illness or injury^[2]. Your monthly payments could be used to cover rent/mortgage costs, as well as other daily living costs.

If you’re not sure if income protection is right for you, our advised team can talk you through everything you need to know and provide recommendations on what might be best for your circumstances.

Get in touch today to compare quotes from the whole of the market.

How much income protection do self-employed workers need?

Work out how much income protection insurance you may need based on your current financial commitments. Simply fill in the fields which apply to you for an instant calculation.

Your total cover estimate

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Let us find your best quotes.

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How does self-employed income protection work?

Income protection for self-employed works the same as any other income protection policy:

You’ll apply for a policy by providing details about yourself and your cover requirements. Your eligibility and the price you pay will then be assessed.
Once a policy is in place, you’ll pay a monthly premium.
If you develop an illness or sustain an injury which prevents you from working (as per the terms and conditions of your policy), you can make a claim.
If you’re still unable to work once your deferred period has come to an end, your payments will commence.
Your policy will then pay out to you until you return to work, your payment period comes to an end or until your policy term comes to an end (whichever happens first).

Does being self-employed affect income protection?

Being self-employed could affect your income protection application if your specific occupation involves a degree of risk.

For example, if your job requires you to use heavy/dangerous machinery, work from height or travel to unsafe areas, you could be seen as high-risk.

During the application, you’ll be asked questions about your occupation to allow insurers to get a better understanding of your personal circumstances.

Being self-employed could also affect what information you need to provide to insurers. As self-employed earnings can fluctuate, you could be asked to provide evidence of earnings from the last 3 years and an average will be taken from this.

You may also be asked to provide information in the form of a personal tax calculation or self-assessment tax return from HMRC.

What is the best income protection for self-employed?

The best income protection for self-employed will depend on your individual requirements.

The terms of an income protection policy can often be tailored to meet your specific needs, giving you choice over how your policy will work.

Policy terms and conditions	Definition
Benefit amount	This is how much will be paid out to you. As this is monthly, it’s sometimes referred to as your ‘monthly benefit’. The amount that’s paid out to you will be a percentage of your gross income (typically between 50% - 70%).
Policy term	Your policy term refers to how long you’ll be covered for. You can choose a term length to meet your needs but, often, cover must need to cease by the time you turn 70.
Definition of incapacity	What makes you eligible to make a claim. Most policies come with an ‘own occupation’ definition, allowing you to claim when you’re unable to do your own job. However, it could be possible for your policy to have a ‘suited tasks’ or ‘any occupation’ definition.
Deferred period	The period that must pass in order for your payments to start. Common options include 4, 8, 13, 26 and 52 weeks. For example, if you had a deferred period of 4 weeks, you must still be unable to work after 4 weeks in order for your payments to start.
Payment period	How long you’ll receive payments for. Your policy could pay out on a short term (a maximum of 1, 2 or 5 years) or long term (until your policy comes to an end) basis. A short term policy could allow you to make multiple claims throughout the policy term, whereas a long term policy could pay out to you for the rest of your working life if you’re unable to return to work.
Premium type	How you’ll pay for your cover. Premiums can be guaranteed (stay the same), reviewable (subject to change at the discretion of the insurer) or age-based (change each year as you get older).

To find the best income protection for your needs, it’s important to compare multiple quotes.

Our advised team can talk through your needs and provide you with the most suitable options.

Quotes are free of charge and without any obligation.

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What is personal income protection for self-employed?

A personal income protection policy can be secured by a self-employed individual to protect their own income.

You’ll be covered if you become too ill or injured to work and a percentage of your gross income will be paid out on a monthly basis.

Your monthly payments can help you to cover living expenses (such as mortgage/rent payments and household bills) until you’re well enough to return to work.

Personal income protection key points:

Up to 70% of your gross earnings could be protected
Cover if you become ill or injured
Can be taken out on a short or long term basis
Monthly payments are tax free
Available through the advised team at Reassured from 20p-a-day^‡

What is executive income protection for self-employed?

Executive income protection can be taken out by self-employed directors of their own limited company.

Through an executive income protection policy you could choose to cover any employee.

This could allow you to cover your own income, or it could allow you to provide financial protection to an employee within your business.

As executive income protection is taken out and paid for by the business, the premiums could be classed as a business expense making them tax deductible for the business owner.

Executive income protection key points:

Up to 80% of the insured employee’s earnings could be protected
Cover if you become ill or injured
Monthly premiums could be claimed as a business expense
Monthly payments (for the insured employee) could be subject to income tax and national insurance
Available through the advised team at Reassured

How much is income protection for self-employed?

The cost of income protection for self-employed will depend on your personal circumstances and policy details. Including:

Personal details:

Age
Occupation
Smoking status
Health & wellbeing
Lifestyle (hobbies, alcohol consumption and drug use)

Policy details:

Benefit amount
Policy term
Payment period
Deferred period
Definition of incapacity
Premium type

Insurers will use this information assess the level of risk you pose and your monthly premium will be calculated accordingly.

Depending on your job role, you could experience inflated premiums due to the increased risk of an illness or accident occurring.

For example, a self-employed construction worker who works on site is likely to pay more than a self-employed freelance writer who works from home or from an office space.

Below are some example quotes from our income protection comparison service.

Quotes are based on a non-smoker, in good health, with a low risk occupation and annual income of £30,000. The policy term is until age 65, with a 3 month deferred period and a 1 year payment period:

Age
20	£7.50	£8.65	£8.76	£8.96
25	£7.50	£10.02	£10.27	£10.40
30	£7.50	£11.51	£12.16	£11.11
35	£7.86	£13.88	£14.37	£13.39
40	£8.78	£17.95	£17.22	£17.00
45	£9.97	£22.86	£21.18	£21.55
50	£11.52	£33.11	£27.18	£32.07

While the quotes above can help to give an idea of pricing, the exact cost you pay can vary based on the factors mentioned above.

Comparing quotes is essential in securing the most affordable cover for your personal circumstances.

Our advised team can save you time and money by comparing multiple quotes at once and finding you the best price policies for your circumstances.

Compare self-employed income protection insurance

Income protection can be vital for self-employed workers to help provide financial support during periods of ill health.

By securing a policy you can have peace of mind that you can take the time off that you need to recover, while keeping up to date with your monthly financial commitments.

Through the advised team at Reassured, it’s possible to secure both personal and executive income protection quotes.

All quotes are personalised, fee-free and without obligation. Get in touch today to explore your options.

Compare Self-Employed Income Protection Quotes »