It may seem strange that your career should determine the type of life insurance you get — but it does! If you’re self-employed, as opposed to being a salaried employee, you face challenges that salaried employees don’t. As such, you need specific life insurance to meet your needs — whether it’s key man insurance, a buy-sell agreement, or no exam life insurance will depend on exactly what your situation is.
But make no mistake about it — while life insurance is important for everyone, it is especially important for someone who’s self-employed.
Here are 5 reasons why life insurance so crucial when you’re self-employed.
You Don’t Get Life Insurance From an Employer
85% of employers offer some form of group term life insurance, according to a 2018 report by the Society for Human Resource Management. And while there are many arguments as to why group coverage isn’t enough, at least it’s something. But when you’re self-employed, you don’t get even a little coverage — unless you purchase a full life insurance policy yourself.
You Are Crucial to Your Business
If something happens to you, your business can tank. And if you have a business partner, what is he supposed to do? Life insurance can help your business partner avoid financial disaster should the worst happen. Key man life insurance and a buy-sell agreement funded by life insurance are two popular options, designed specifically to help your partner save or sell the business.
You Need Life Insurance to Get a Business Loan
Most business loans require the borrower to have life insurance, at least for the amount of the loan. In this case, a no exam life insurance policy is your best bet. These policies come with very short (or no) underwriting processes and you can be approved for a policy in days, as opposed to weeks or months. This can make the entire loan process go much quicker.
Life Insurance Can Help Pay Off Debt
Most salaried employees won’t leave behind a lot of loose ends or debt that their families will have to clean up in the event that they die. But if you’re self-employed and don’t have a partner, if you die you may leave your family with a whole lot of debt. In this case, life insurance is crucial to save your family from financial ruin.
You Need to Ensure That Your Family Will Be Cared For
Whether you’re self-employed or work for a company, the main reason that anyone gets life insurance is to make sure that their family is taken care of if they die. But because your family’s income is directly tied to your business, it’s essential to get a life insurance policy that will not only help them avoid debt, but that will leave them enough to live on until they can figure out a solution. In this case, you’ll want to get a policy that has enough coverage to give your family solid financial footing until they can get back on their feet.
Don’t Get Only One Quote
If you’re not sure which life insurance policy is best for you as a self-employed individual, Sproutt Life Insurance is a great place to start. There you can chat with an unbiased insurance advisor who can assess your situation and point you in the right direction. Sproutt also provides you with multiple quotes from top insurance providers, so no matter what type of policy you choose, you can get the best coverage at the best prices.
