Self Employed Disability Insurance – Protecting Business Owners

Being your own boss has many advantages. The freedom to set your own schedule, control over client and business relationships, and a sense of freedom are some of the main reasons why an increasing number of Canadians are embarking on the self-employed path. Self-employment comes with a list of challenges, an asset, health insurance, and more specifically… disability insurance.

Losing the safety net of an employee benefits program offered by large employers is challenging and sometimes costly. Purchasing disability insurance through a group plan will have lower rates, no medical examinations and no financial commitments, but once you leave the group plan for self-employment, the rules change! Rates are higher, insurance requires more details, and you may need to undergo a medical examination. These new loops to jump over tend to be the reason why most self-employed people hesitate to seek any form of extended healthcare.

It is estimated that 15% of Canada’s workforce is self-employed. A recent study showed that more than 500,000 Canadians said they’ve started their own businesses in the past two years, a record number. (CIBC Study, Globe and Mail). Failure to have appropriate disability insurance to protect a person’s ability to earn an income can have consequences. Disability Insurance helps protect your job (overheads) and family if you are unable to go to work, an important building block to consider when self-employed.

You may be making more than working for someone else, but what if you get sick? Or have you had an accident that caused you to temporarily or permanently lose income? You will likely have some medical expenses, personal expenses, and you may not find your accounts payable as patient as you hoped. This is where a well-structured disability insurance plan can create a safety net and allow you to focus on getting back to your health and take time off the work you need.

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While most business owners in their 40s and 50s are more conscious of their own mortality rates, there has been a marked increase in the number of entrepreneurs starting their own businesses in their 20s and 30s. While stimulating the economy, it is important not to forget the benefits and importance of a well-structured disability plan.

A simple question to ask yourself is: How do you plan to live if you can’t earn an income? More precisely, if you can no longer generate an income, how will you support your dependents, pay your staff, or pay the overheads of your business?

About Lily Hammond

I have been working as an insurance consultant in my own insurance agency since 1998. Because I've been doing this for so long, I know every detail and I'm here to help you. You can find my e-mail address and work phone on the contact page.

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