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Self-employed woefully under-insured

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Self-employed woefully under-insured

Almost two million of the country’s self-employed can’t afford to save anything each month, said LV=.

The insurance provider said that the UK’s nearly five million self-employed people save less and spend more on bills than the average employed worker.

Four in 10 self-employed people can’t afford to save any money each month and a further one in 10 saves less than £50.

A third of the self-employed surveyed admitted they couldn’t survive for more than three months if they lost their income. However, monthly bills eat up the wages of nearly two thirds of self-employed people, compared to a national average of 56%, making saving extremely difficult.

Need for cover

Self-employed people don’t have the safety net of employers’ benefits, such as sick pay, so income protection is often recommended.

Despite this, only 4% of self-employed people in LV=’s research have income protection, compared to a national average of 11%, with more than two fifths (42%) mistakenly believing that they’re not eligible for it.

Justin Harper, head of protection policy at LV=, said: “The labour market has changed markedly in recent years, with self-employment continuing to rise. We recommend self-employed people speak to a professional financial adviser about whether they’d benefit from taking out private insurance, such as an income protection policy that will pay out if they couldn’t work because of accident, sickness or disability.”

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