Over the last 20 years or so, the workplace has changed dramatically. We are in a completely different landscape to the one we inhabited around the early 2000s, and in many ways that’s fantastic. Even the days of punching in at 9am on the dot and leaving at 5pm sharp seem to be long gone for a great many of us, due in part to COVID-19, but a host of other reasons too.
During that time, a lot of us inevitably became sick of working 9 to 5 for someone else’s benefit on a daily basis, with plenty of work and very little reward. As a result, the time became right for many people in the UK to start their own business and forge their own path. In fact, the UK’s self-employment numbers show a significant rise from 3.2 million in 2000 to a peak of five million in 2020.
That said, numbers have fallen since 2020, with the pandemic inevitably playing a huge part in killing off many businesses. As is often said though, we are a ‘nation of shopkeepers’, meaning that we are able to weather all manner of storms when it comes to our businesses. When it comes down to it, there are an array of storms that we potentially face as small business owners.
The risks of self-employment
Working for yourself may seem like less of a risk given that you are your own boss, but on the other hand, things are very different once you are relying on your own wits to make a living. You are fully accountable, meaning that in many ways, these risks are simply ones that you cannot afford to take.
Take for instance falling ill, or suffering an injury for which the business needs to be put on hold – do you have the requisite support in place should the unfortunate happen? Will your family be looked after in any case? These are questions that you as a self-employed individual have to ask.
On a similar note, there is the potential that one of your clients should suffer a fall during a meeting on your premises, meaning you could be liable for it. This is something insurance can help mitigate. Then, there come the other potential pitfalls, such as inconsistent cash flow, and perhaps a lack of clients.
Then, you have other factors that perhaps go under the radar as a self-employed individual, such as your tax situation. It seems almost inevitable that you end up paying more tax, meaning that the possibility exists that you miscalculate some numbers somewhere and end up with a huge tax bill. Then comes the stress involved with everything that owning a business entails.
Thankfully, Suited Insure offer a fantastic product for bookkeepers looking for PI cover. But what exactly is PI cover, and what does it involve?
What is PI cover?
PI Stands for Professional Indemnity insurance, and it’s a commercial policy that aims to protect you as a self-employed individual, whether you’re a business owner or a freelance worker. The particular focus of PI is when clients claim that the service is inadequate. There is always a risk in business that you could be sued in the event of this, which makes PI highly critical for a self-employed individual.
Disagreements can occur, though of course you would hope that they are kept to the bare minimum, or ideally eliminate them entirely. Unfortunately, life can throw all kinds of spanners in the works, meaning that you may be liable in the event of something of this nature happening. PI has you covered, including prospective legal fees as well.
What other covers might be needed?
There are countless other kinds of insurance that you may need as a self-employed individual, but you’ll want to keep the costs as low as you possibly can. That said, there are a few kinds of insurance that are a must-have if you work for yourself.
For starters, building and content insurance will protect your physical property, just as home insurance protects your dwelling in the event of anything beyond your control. Credit insurance also exists to protect your revenue in the event that you aren’t paid.
One kind of insurance that you may not have been made aware of is keyman insurance, which could be extremely useful in the event that one of your most vital employees should leave the business.
Overall, it’s a tricky business being self-employed, but it’s always worth exploring your options to see what you need, and how you can cover yourself in every possible eventuality.
