Amongst some self-employed people, there is a fairly commonplace misconception that sickness insurance is something that employers pay to their staff and by consequence, is not something that applies to them.

Ironically, some salaried employees believe that this form of cover only applies to the self-employed!

So, what’s the reality?

Self-employed businesses 

As anyone who is self-employed probably knows only too well, if you are unable to work for reasons of sickness or accident then you typically find that your income stream dries up very quickly.

If you are ill or injured, probably the last thing you will want is to start finding that financial worries have appeared on your doorstep as well, which why many self-employed people look to income protection policies to provide them with a degree of peace of mind.

This type of policy, provided by specialists such as Drewberry Insurance, typically work on the simple basis of generating a monthly income for you in the event that you are unable to work due to a condition covered by the policy.

Those payments might be as high as 60% of your previous gross monthly income and can continue for a period you select at the outset when purchasing your policy.

Periods ranging from 12 to 24 months might be typical though longer durations might also be available.

Employees

Contrary to what some self-employed people believe, not everybody working for an employer has extensive sick pay provisions and benefits.

The statutory minimum, as laid down by the government, is a relatively modest sum of money that, at the current time, only has to be paid out for a total of approximately 28 weeks.

As a result, some employees recognise that they may find it extremely difficult to cope if they are forced to survive on the statutory minimum sick pay.  They therefore look to supplement their protection through policies for income protection aimed at employees rather than self-employed businesses.

Perceptions

As you can see from the above, this type of insurance cover may prove to be extremely useful for individuals, whether they are salaried employees or self-employed business people.

The circumstances covered by these policies may be wide ranging including both accidents and sickness. As with all insurance policies, there will be terms and conditions which should be studied carefully as part of your selection of cover for you and your life circumstances.

Coping in a financial crisis

Accidents and sickness do not just happen to other people.  If you lose your income, you may find that numbers of your creditors may move fairly quickly from being sympathetic and understanding to very demanding.

In some cases, they may move even more quickly than you would wish to repossession and recovery type actions if you are unable to maintain repayments on things such as mortgages, cars, HP and so on.

So, whatever your employment status, finding out a little bit more about this type of cover might be to your advantage.