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What Type of Insurance Should You Get as Self-Employed?

Self-employed workers have to fend for themselves when it comes to insurance. Clients won’t provide benefits, and that leads to an uphill climb when you need protection.

Getting the correct insurance is mandatory and should be your first move as an individual.

The Hassle of Self Employment

When you decide to dive into self-employment, the best disability insurance will be your best friend. Insurance is something that is easy to forget when you don’t have a job that sends reminders about it every year.

You also have to change how you file taxes and provide your own equipment. Self-employment gives you more freedom so you have to be willing to take on the extra responsibility.

What happens when you get sick and don’t have insurance? A simple cold can turn into a life-changing financial burden.

Instead of being covered, you’re forced to make decisions that balance out your work schedule, personal health, and cost concerns.

With insurance, you can concentrate on what matters the most instead of playing a juggling act with your personal life.


Health insurance for the self-employed usually means relying on government health insurance. Depending on your location, this can be a great experience or an intimidating one.

Government health insurance does a good job of covering essential needs.

But it still relies on health professionals that are willing to opt into the program. In a situation where you need to use an out-of-network provider, it can cost a lot more than you’re willing to spend.

But this is the unfortunate reality if your location is not compatible with government health insurance.

Thankfully, new laws have been passed to make individual health insurance a viable option. Instead of depending on government health insurance, self-employed individuals can now apply for insurance that scales in cost based on their income.

There is plenty of time during the open enrollment period, and a lot more options to prevent you from having to seek services that are out-of-network.

If you have employees, then chances are it will restrict you from signing up for individual health insurance for the self-employed.

At this point, you will have to look into third-party health insurance to cover all of the important options.

Third-party health insurance is not a downgrade, and with some research can be just as formidable as government or self-employed individual plans.

Health insurance is the bare minimum you should have when working for yourself.


Disability insurance protects your business from folding when you sustain long-term injuries. For self-employed individuals, disability insurance favors white-collar professions.

It’s important to have a clear paper trail that shows your income year to year. Without a clear outlook on income, an insurer can’t create a favorable policy.

This is an important lesson when you decide to get disability insurance while self-employed. If you’re just starting out, the contract will not work in your favor.

But with three years of consistent income, the policy offered will make filing a claim worthwhile.

The fine print matters when getting disability insurance. When you’re self-employed, the restrictions that disqualify you are a lot stricter.


No one walking the earth should be without life insurance. It is the most accessible insurance type available and provides the most value vs. money paid.

Life insurance for the self-employed is rewarding on multiple levels since it can ensure the continuation of the business.

If you have a plan in place after your passing, then life insurance works as the vehicle to keep things moving. This is especially important since taxes can sometimes interfere and cause estate issues.

Life insurance is one of the many types of insurance that will help alleviate the burden. Getting a life insurance policy is painless, and highly flexible if you’re willing to invest in yourself.


Self-employment actually became more widespread due to massive unemployment. Individuals wanted more control over their financial independence. By being their own boss, being laid off was no longer a concern.

Unfortunately, that doesn’t mean that self-employment completely neutralizes unemployment. If no one is willing to use your services, then you have been effectively laid off or fired.

Unemployment is a touchy subject for the self-employed. For a while, both the state and federal governments were behind when it came to rules for unemployment.

For the self-employed, their guidelines were a bit chaotic when determining needs. This has a lot to do with the self-employed not paying unemployment taxes.

Technically, there is no insurance available if you need protection from unemployment – technically. Unemployment benefits are available under specific conditions due to the CARES Act.

It is usually activated in emergencies but can help keep individuals and their companies from going too deep into the red.

When that option isn’t available, structuring your business as an S Corporation is an important move to make. When you’re handling other types of insurance, this is a movie that deserves careful consideration.

Since specific insurance options aren’t available for unemployment, being able to collect benefits through an S Corporation structure will protect you from state and federal oddities.

Once you make this move, you are considered an employee and will have to deduct state and federal taxes. It is a minor con attached to an excellent plan to provide faux unemployment insurance to self-employed individuals.

With more people considering this path every day, it may materialize into a widespread solution when new employment laws are created.


General liability and professional liability insurance protect you from financial loss. Despite its importance, there are millions of self-employed individuals that don’t have this coverage.

If a single unhappy client goes after you for negligence, the legal costs alone could wipe out your entire business.

Even if you end up settling out of court, the financial and reputation costs can be unrecoverable without years of hard work.

Stay away from potential bankruptcy by getting health and liability insurance in Utah or other states you operate from, ASAP. It’s your responsibility as a self-employed worker to protect your best interests since a larger company isn’t covering your rear.

Protect Your Worth

Insurance is so important that it became a huge part of doing yearly taxes. Although the impact has now been lessened, that doesn’t change the fundamentals of being insured. Protect yourself in the present, and insurance will protect your future.


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