Published on 03/07/2012
As 8.2 per cent of the working age population becomes self-employed, experts emphasise the importance of income protection insurance for people who manage their own business.
According to recent figures from the Office for National Statistics (ONS), almost 4.2 million people were registered as self-employed over the three months to April.
This is a rise of 84,000 over the previous three months, and the highest figure since records began in 1992. According to the ONS, the number is equivalent to 8.2 per cent of the working-age population.
This surge in self-employment has come about because people have been unable to find permanent work with companies due to the flat-lining economy. Chris Short, a director at recruitment firm Concept Resourcing, said:
“Many would-be employees understand that they will often be more attractive to employers if they are self-employed and work on a contract basis.”
But individuals who manage their own business do not have the same level of protection from accident or sickness as those who are employed. Self-employed workers will not receive sick pay or income protection insurance as part of an employee benefits package.
Consequently, if they become ill or suffer an accident they will have to rely on savings or Employment and Support Allowance of £95.15 per week.
Recent research from MetLife shows that 21 per cent of employees have been off work for more than four weeks through illness. Stephanie Baillie of MetLife said: "Long term sickness absence leading to more than four weeks off work has been experienced by a significant proportion of the working population.
“Insurance cover that protects against life’s uncertainties is absolutely essential as many would be left unable to support themselves if they lost their livelihood through illness.”
© ActiveQuote Ltd. 2012Categories: Income Protection