REPORT ER Philippa McLaglen, Marketing Manager from There® Experts INCOME PROTECTION
As self-employment numbers grow, it’s now more important than ever...
Self employment is at its highest point for the past 40 years, with over 4.6 million people currently working for themselves. This means that approximately 15 per cent of the UK’s population in gainful employment are self-em- ployed*.
Often self-employed workers find themselves working in industries that make them highly susceptible to risk of injury and stress. This is a real worry, especially if no one has their back when off work ill, or for even longer with a serious injury.
Family focussed insurance company There® decided to do some research, investigating self-employed workers’ attitudes to taking time off sick and what the implications of being off ill have on their business.
More and more people are making a go of it on their own as we witness a ‘self-employed shift’, leaving behind the safety of the monthly salary to pastures new, starting their own business. However finding a healthy work/life balance is crucial and often easier said than done. Our research found that self-employed workers are 10 per cent more likely to suffer from serious stress than those who have an employer.
Too ill to work
More detailed analysis shows that self-em- ployed workers are twice as likely to get ill or be injured at work causing them to take time off sick. 35 per cent of the self-employed questioned stated that they had suffered an illness or injury that kept them off work for a month or more. Those who had been off for a month or more, stated that on average they were off for over 3 months in total.
The dilemma here is that when you work for yourself, you do not have anyone to cover for you if you have to be off for a substantial period of time. This can have a detrimen- tal effect on income and brand reputation, plus it increases the risk of losing clients to competitors. The survey discovered that financial pressures were the biggest cause of concern when it came to taking time off work, with more than half admitting that loss of income was the number one problem with being off ill. Without the financial safety net of an employer’s sick pay, finances can be very vulnerable.
Attitudes to being off
It seems that when self-employed profession- als are ill, they are actually ill and sick days
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aren’t taken lightly. Research showed that of the days taken off sick 68 per cent of those really couldn’t have been worked, no matter what the situation.
Some self-employed professionals have taken the fear of being away from work to the next level, by giving up ‘dangerous’ or ‘risky’ sports or past-times in order to avoid injury. 43 per cent stated that they are certainly more risk averse now they run their own busi- nesses. 46 per cent actually highlighted that they had given up a physical activity in order to prevent an injury from happening in the future. This is substantially higher than the 21 per cent of employed workers who worry about getting injured. Football topped the list for physical activities ‘given up’ for fear of injury, followed by running, skiing/snowboard- ing and cycling.
It is interesting that people would rather give up their much loved hobbies, when it could be more practical to take out insurance to help protect against loss of income from more serious injuries and continue with their active pastimes.
Protection
It appears that self-employed professionals are more likely to have income protection insurance than those who are employed, but
it is still a minority with 67 per cent leaving their income unprotected and finances at risk. In fact 33 per cent of the self-employed pro- fessionals questioned worry they would not be able to pay the bills if they were off work for a month or more. They are twice as likely to perhaps need a payday loan with nearly one in ten admitting this is something they would have to consider if they were off work for more than a month, just to pay the bills.
One quarter would have to turn to family for financial support and 24 per cent would have to alter the way they live in order to survive.
Conclusion
It is clear that the self-employed don’t have sufficient income protection if they are unable to work for a while due to illness or injury. With financial protection, anything is better than nothing, as long as it helps to pay the bills and keep food on the table for the family.
Products such as There’s® Too ill to work
cover are designed to pay out if someone has an illness or does injure themselves, like breaking an arm or leg, and can’t do their job for a while. It is simple and easy to set up, with payments continuing until they are well enough to return to their job, or for up to 5 years. For more information please visit:
www.there.co.uk
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