No matter how much you plan, life can take you by surprise.
This year and next there are many changes coming to contractors which may be hard to prepare for. For example, though it was initially disregarded, there is a possibility we could be heading toward a no deal Brexit and it is unclear as to how that will impact contractors inside and outside of the UK. Similarly, it was announced that IR35 rules will be applied to the private sector from April 2020, meaning contractors may be faced with the same tax and national insurance contributions as regular employees, without the extra benefits.
Though there is no way to understand fully what the future has in store for contractors, one thing you can ensure is that you and your family are financially protected.
As a contractor, it is especially important to make sure you’re financially protected as you don’t have an employer to rely on. That means that you lose out on some benefits you may have had previously received such as sick pay and death-in-service.
With many different contractor insurance products on the market though, determining which is right for you can be more confusing than it needs to be! This is where a contractor protection specialist could help.
Before you look into what is the right protection, consider these points:
- Who or what do you need to protect?
- How long do you need to be protected?
- What cover do you already have in place?
- What amount of money do you need to be financially protected in any given scenario?
There are many different insurance products that can financial protect you, whatever the future holds:
If you are unable to work due to an illness, you can’t earn. And, if your illness lasts a few weeks or months, this could place you in a precarious financial situation. Having income protection in place will mean that you continue to receive a regular wage until you’re able to get back on your feet. Saving you from worrying about your mortgage payments and any other bills.
Particularly important yet 42% of homeowners do not have life insurance in place. Life insurance will make sure your family keep a roof over their head even after you’ve passed away. It pays out a tax-free lump sum which can be put toward repaying the mortgage, your family’s everyday living costs and even cover the cost of your funeral. As life in unexpected, having life insurance in place will make sure your family have the funds to keep them financially secure in the event of your death.
Relevant Life Insurance
If you’ve set up as a limited company you could make a huge saving by expensing your life insurance through your business. This is known as relevant life insurance. It has the same features of regular life insurance mentioned above but it is a tax efficient method of paying for it. Find out more about Relevant Life Insurance here.
Critical Illness Cover
Did you know that you’re likely to be affected by a critical illness before retirement age? It’s scary to think about but it puts into perspective how important it is to review the insurance you have in place. Critical illness cover pays a lump sum if you’re diagnosed with an illness that prevents you from going back into your field of work. This money can be put toward mortgage repayments or to making adjustments to your home, such as a ramp or stair lift, should it be needed.
We can’t always be sure of what will happen in the future, but having financial protection in place will give you peace of mind. To make sure you’re prepared, we’ve partnered with Broadbench who are offering all our readers an opportunity to review the protection you have in place for free! Get it touch to review your protection and protect your future.