Self-employed exposed to unnecessary financial risk

A large number of the UK’s self-employed workers could be personally exposed to the various risks associated with running a business, exclusive research carried out by self-employment insurance specialist, Qdos, has revealed.

The insight suggests that nearly one in three (29%) self-employed workers surveyed do not hold insurance at all, with over half of this group stating they do not believe they need it. This group of workers (83% of whom are sole-traders) do not hold insurance for the following reasons:

• 53% do not think they need it
• 25% believe it’s too expensive
• 17% have never considered it at all
• 8% are looking to buy it
• 1% can’t find the right policy
• 1% say they are self-insured
• 5% stated ‘other’ reasons

Of the 71% of individuals who hold at least one form of insurance, the most common policy is public liability insurance (64%).

Higher earners (£50k+ annual turnover) are more likely to have insurance in place (95%), while those earning under £50k a year are less likely (63%).

Seb Maley, CEO of Qdos, a self-employment insurance provider, commented:

“Self-employed workers are exposed to all kinds of risks on a daily basis – many of which they have no control over and cannot see coming. When running a small business, there’s no escaping the fact that you might have an accident and not be able to work, make a mistake for which you’re liable or even be investigated by the taxman.

“Sole traders do not have the luxury of being protected by their limited company either. This means that if an incident does happen, they will be personally liable should they not hold insurance. Given challenging HMRC, for example, can cost individuals thousands of pounds, the old adage it’s better to be safe than sorry has never been truer.”