There are innumerable benefits of being self-employed, from being your own boss to the flexible schedule, not to mention the greater earning potential. However, along with the benefits, there comes added pressure; the self-employed must be a jack of all trades, juggling many balls and taking on responsibility for all areas of the business. Business Wales has some great advice for self-employed businesses just starting out, as well as businesses looking to grow and develop.
Considering the risks is a vital part of running a successful business, whether a big corporation or a one-man band; but there’s no need to let this panic you. Taking out a comprehensive insurance policy can mitigate the risk and will mean you’re protected in case the worst should happen. There are a few key pieces of insurance that every self-employed business should have; and in some cases this is not just best practice, it is also a regulatory requirement, so it is worth double-checking the level of cover that you will need.
If you come into contact with members of the public in the course of your daily work life, you will need public indemnity insurance to cover you in case you cause injury or damage to a person or their property. Similarly, if you employ any other people in the course of your business activities, employers’ liability cover is essential. Many people will be providing professional advice to their clients as part of their business, meaning that professional indemnity insurance is required.
While you may strive to provide your customers with the best possible service, there are no guarantees that everything will work out. If a client suffers financial loss as a result of your advice, they may choose to make a claim against you. Professional indemnity insurance will cover the costs of defending yourself against the claim, as well as the cost of any settlements made in favour of your client. For further information about professional indemnity insurance policies, click here. In many cases, professional indemnity insurance is a regulatory requirement and many clients will not work with you if you are not covered.
Self-employed people will often work from home, falsely believing that their home insurance policies will cover business costs in the event of an incident. However, this is often not the case, so a separate policy should be arranged; setbacks like theft of equipment or floods can cost your business greatly so it’s better to be safe than sorry! Many insurance companies will allow you to tailor your policy for your individual business, meaning that you won’t be paying over the odds for proper cover.
If you are thinking of setting up as self-employed and are concerned about all of the admin work involved, the Citizen’s Advice Bureau has a checklist to guide you through the process and ensure that you have everything you need to make your business a success.