Photo by RDNE Stock project

Financial security is a top priority for individuals who work on their own accord, and that is one benefit insurance for the self-employed gives. Self-employed individuals should consider health, disability, liability, and business property insurance. Self-employment requires various insurance coverage options, which will be included for better understanding in this article.

Insurance For Self-Employed

Individuals who work for themselves and do not have access to employer-sponsored health insurance plans purchase insurance for self-employed people.  Being self-employed comes with its own set of challenges, including the need for insurance coverage. 

Types of Insurance For Self-Employed

Here are some types of insurance that self-employed individuals can choose from 

#1. Health Insurance

Self-employed individuals can purchase health coverage through the individual Health Insurance Marketplace. When filling out a Marketplace application, it is important to estimate net self-employment income for the year to determine eligibility for savings.

#2. Self-Employment Tax Deduction

Self-employed individuals can deduct the employer-equivalent portion of their self-employment tax when calculating their adjusted gross income for income tax purposes. This deduction does not affect net earnings from self-employment or self-employment tax.

#3. General Liability Insurance

This type of insurance provides coverage for claims of bodily injury, property damage, or personal injury that may arise during business operations. It helps protect self-employed individuals from financial losses resulting from lawsuits or legal claims.

#4. Professional Liability Insurance (Errors and Omissions Insurance)

Professionals who provide services or advice, such as consultants, accountants, or architects, may need professional liability insurance. This coverage protects against claims of negligence, errors, or omissions that could result in financial harm to clients.

#5. Business Property Insurance

Self-employed individuals who own or lease a workspace or office should consider business property insurance. It covers damage or loss of business property, including equipment, inventory, and furniture, due to events like fire, theft, or natural disasters.

#6. Commercial Auto Insurance

If a self-employed individual uses a vehicle for business purposes, such as making deliveries or meeting clients, they may need commercial auto insurance. This coverage protects against accidents, damage, or theft involving the vehicle used for business activities.

#7. Workers’ Compensation Insurance

If a self-employed individual has employees, they may be required to have workers’ compensation insurance. This coverage provides benefits to employees who suffer work-related injuries or illnesses, including medical expenses and lost wages.

#8. Cyber Liability Insurance

With increasing reliance on technology, self-employed individuals who handle sensitive client data or operate online businesses should consider cyber liability insurance. It protects against data breaches, cyber-attacks, and other liabilities related to the loss or theft of digital information.

#9. Life Insurance

Self-employed individuals may also want to consider life insurance to provide financial protection for their loved ones in the event of their death. Life insurance policies can provide a death benefit that can help cover expenses and provide for dependents or business partners.

#10. Self-Employed Health Insurance Tax Deduction

Under Section 2042 of the Small Business Jobs Act, self-employed individuals can deduct the cost of health insurance for income tax purposes. This deduction is taken into account when calculating net earnings from self-employment

Best Health Insurance For Self-Employed

Finding the best health insurance for self-employed individuals requires considering coverage options, affordability, and their unique needs. While there are several options available, here are a few insurance providers that are  suitable for self-employed individuals:

#1. Oscar

Oscar is one of the best overall health insurance providers for the self-employed. They offer convenient health apps, and virtual care options, and have ACA plans available in multiple states.

#2. Aetna

Aetna is known for providing premium tax credits and is considered a good option for self-employed individuals. They offer a range of health insurance plans and have a strong network of healthcare providers.

#3. Blue Cross Blue Shield

Blue Cross Blue Shield is recognized for offering good value gold plans. They provide a variety of health insurance options and have a wide network of doctors and hospitals.

#4. Molina Healthcare

Molina Healthcare is a provider of affordable bronze and silver plans. They offer cost-effective options for self-employed individuals, although it’s important to consider the higher deductibles associated with these plans.

#5. Health Insurance Marketplace

The Health Insurance Marketplace, also known as the Exchange, is a platform where individuals can purchase health coverage. Self-employed individuals can buy health insurance through the Marketplace, and they may be eligible for savings based on their estimated net income for the year.

#6. Cigna

Cigna is known for offering a variety of health insurance plans for self-employed individuals. They provide a range of coverage options, including individual and family plans, with access to a wide network of healthcare providers.

#7. Kaiser Permanente

Kaiser Permanente has an integrated healthcare system, offering both health insurance coverage and healthcare services. They provide comprehensive health plans with access to their network of doctors, hospitals, and specialists.

#8. UnitedHealthcare

UnitedHealthcare offers health insurance plans specifically designed for self-employed individuals. They provide a range of coverage options, including short-term plans, individual plans, and options available through the Health Insurance Marketplace.

#9. AARP

AARP offers health insurance options for self-employed individuals who are 50 years or older. They provide a variety of coverage options, including Medicare Advantage plans, supplemental plans, and prescription drug coverage.

#10. Humana

Humana offers health insurance plans for self-employed individuals, including individual and family plans. They provide a range of coverage options, including HMO, PPO, and high-deductible health plans.

Disability Insurance For Self-Employed

Disability insurance is an important type of coverage for self-employed individuals, as it provides financial protection if they become unable to work due to a disability.

Characteristics To Consider About Disability Insurance For The Self-Employed

#1. Disability Insurance Elective Coverage (DIEC)

 In California, self-employed individuals who do not pay into State Disability Insurance (SDI) can opt for the Disability Insurance Elective Coverage (DIEC) program. This program offers coverage for disability insurance and paid family leave.

#2. Private Insurance Companies

Many private insurance companies offer disability insurance policies specifically designed for self-employed individuals. Providers like Northwestern Mutual, Guardian, Mutual of Omaha, MassMutual, Breeze, and Assurity offer disability insurance tailored to self-employed individuals, offering customizable plans, flexible coverage options, and easy online application processes.

#3. Types of Disability Insurance

Disability insurance offers two types: short-term, providing coverage for a few months, and long-term, providing coverage for an extended period, often until retirement age, to replace income if a long-term disability prevents work, with longer waiting periods for benefits.

#4. Elimination Period

The elimination period, also known as the waiting period, is the period you must wait after becoming disabled before you start receiving benefits. It can range from a few days to several months, depending on the policy. Shorter elimination periods result in higher premiums.

#5. Benefit Amount

Disability insurance policies cover a percentage of your pre-disability income. The benefit amount is usually between 50% and 70% of your income. Consider your financial needs and obligations when deciding on the benefit amount. Higher benefit amounts usually mean higher premiums.

#6. Own-Occupation vs. Any-Occupation Coverage

Own-occupation disability insurance provides benefits if you are unable to perform the specific duties of your occupation. This type of coverage is more comprehensive and generally more expensive. Any occupation disability insurance only pays benefits if you are unable to engage in any occupation for which you are reasonably suited by training, education, or experience.

#7. Business Overhead Expense (BOE) Coverage

BOE coverage is specifically designed for self-employed individuals, covering business-related expenses when they are disabled. It can help pay for rent, utilities, employee salaries, and other essential business costs during your disability. BOE coverage is useful for ensuring your business can continue to operate while you recover.

#8. Premiums and Policy Costs

The cost of disability insurance can vary based on factors such as age, health, occupation, benefit amount, elimination period, and policy features. It’s essential to obtain quotes from multiple insurance providers and compare the coverage and costs to find the best fit for your circumstances.

#9. Social Security Disability Insurance (SSDI)

Self-employed individuals may also be eligible for Social Security Disability Insurance (SSDI) benefits. However, qualifying for SSDI can be more challenging than obtaining private disability insurance, and the benefits may be lower. SSDI also does not provide coverage for business overhead expenses.

#10. Private Disability Insurance

Self-employed individuals can also purchase private disability insurance policies from various insurance providers. These policies provide income replacement if the insured person becomes disabled and unable to work. Private disability insurance policies can be customized to meet individual needs and can provide coverage for both short-term and long-term disabilities.

The Best Insurance For Self-Employed

The best insurance options for self-employed individuals include health insurance, disability insurance, liability insurance, and business property insurance. Health insurance can be obtained through the marketplace or group plans. Disability insurance provides income protection, while liability insurance covers lawsuits. Business property insurance protects assets. 

Features of The Best Insurance For Self-Employed

The best health insurance for self-employed individuals has features to look for including 

#1. Comprehensive Coverage

The best health insurance should provide comprehensive coverage for a wide range of medical services, including doctor visits, hospital stays, prescription medications, preventive care, and specialist consultations.

#2. Affordability

Cost is an essential factor for self-employed individuals. Look for insurance plans that offer a balance between monthly premiums and out-of-pocket costs, ensuring that the coverage is affordable while still providing adequate benefits.

#3. Network of Providers

Consider insurance plans that have a broad network of doctors, hospitals, and specialists. This ensures that you have access to quality healthcare providers and can receive the necessary medical services when needed.

#4. Flexible Plan Options

Look for insurance providers that offer a variety of plan options to cater to different needs and budgets. This includes options for different deductible levels, copayments, and out-of-pocket maximums.

#5. Prescription Drug Coverage

Ensure that the insurance plan includes coverage for prescription medications. This is particularly important if you have ongoing medication needs or chronic conditions that require regular prescriptions.

#6. Telehealth Services

Telehealth services, such as virtual doctor visits or telemedicine, can be beneficial in the digital age, making it essential to consider insurance plans that offer these options.

#7. Customer Service and Support

Consider insurance providers that have a reputation for excellent customer service and support. This ensures that you can easily navigate the insurance process, get answers to your questions, and receive assistance when needed.

#8. Retirement Plan Options

Some insurance providers may offer retirement plan options specifically designed for self-employed individuals. Look for plans such as solo 401(k), SEP IRA, or SIMPLE IRA that allow you to save for retirement while enjoying potential tax advantages.

#9. Additional Benefits

Some insurance plans may offer additional benefits such as wellness programs, preventive care coverage, mental health services, or alternative therapies. Consider these additional benefits when comparing insurance options.

#10. Integration with Accounting Software

If you use accounting software for your self-employed business, consider insurance providers that offer integration with popular accounting software. This can streamline administrative tasks and make it easier to manage your insurance expenses.

What Insurance Do You Need If You’re Self-Employed?

If you’re self-employed, you typically need health insurance, disability insurance, liability insurance, and business property insurance. Health insurance covers medical expenses, disability insurance provides income protection, liability insurance protects against lawsuits, and business property insurance safeguards business assets. Consult with insurance professionals to determine the best coverage for your needs.

What Is Epo Insurance?

 EPO insurance refers to health insurance plans offered by an Exclusive Provider Organization (EPO). EPO plans work similarly to HMO plans in that they only cover care from providers within their network, except in emergencies. However, unlike HMOs, EPO plans do not generally require members to choose a primary care physician (PCP) or get referrals to see in-network specialists. This gives members more flexibility while still maintaining a narrow network and lower premiums. EPO insurance plans typically have lower monthly premiums compared to PPO plans since they have restricted provider networks. However, members are responsible for the full cost of any out-of-network care besides emergency services.

What Do You Need To Do As A Self-Employed?

As a self-employed individual, you need to register your business, pay taxes quarterly, maintain financial records, find clients, manage your workload, and consider benefits and insurance.

What Are The Options For Self-Employed?

The options for self-employment include freelancing, running an online business, becoming an independent consultant, starting a traditional brick-and-mortar business, or working as an independent contractor in your field. 

Which Account Is Best For The Self-Employed?

The best account for self-employed individuals depends on their specific needs and preferences. Some recommended options include Bluevine Business Checking, Lili Basic Business Checking, Found Small Business Banking, and Grasshopper Business Checking Account. Factors to consider when choosing an account include monthly fees, minimum opening deposit requirements, transaction limits, ATM fees, interest rates, and additional features like software integrations. It’s best to review the specific details and compare different options to find the best fit for individual needs.

What Do Self-Employed Pay?

Self-employed individuals have tax obligations such as income tax, self-employment tax, and estimated tax. They may also have the option to enroll in optional coverage programs like Disability Insurance Elective Coverage (DIEC) and Paid Family Leave (PFL). Health insurance can be obtained through the individual Health Insurance Marketplace. 


Insurance for self-employed providers offer affordable coverage options, a wide network of healthcare providers, and convenient health apps. However, higher deductibles may apply. The best insurance should offer comprehensive coverage, affordability, a broad network of providers, and flexible plan options to cater to different needs and budgets. Disability insurance is crucial for self-employed individuals, providing financial protection if they become unable to work due to a disability. Own-occupation and any-occupation coverage are available, and business overhead expense (BOE) coverage is designed for self-employed individuals. The cost of disability insurance varies based on factors like age, health, occupation, benefit amount, and policy features.


Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like