More South Africans are, through choice or necessity, working as freelancers, independent contractors or gig economy workers. Though exact numbers are hard to find, estimates suggest that 10-15% of South Africa’s workforce is self-employed. The trend towards self-employment is thought to be growing due to job losses in the formal sector as well as some professionals seeking better work/life balance and higher pay than they get in the corporate sector.
Freelance, temp, contract and gig economy workers are a diverse bunch. They include contract programmers, freelancer designers and writers, marketing and management consultants, and self-employed accountants. What they all have in common is that they’re usually accountable for managing the risks they face in their businesses, which are often run from their homes.
Don’t leave your business at risk
This is where insurance comes into the mix as a way to mitigate the risks you face as a self-employed worker. The right insurance policies will help you to protect your livelihood and assets should you experience an event that threatens your business. Should you be the victim of a robbery, legal dispute or fire, insurance will help you to reduce the losses and recover from the incident.
Depending on your line of work, you may need to consider a range of different types of insurance: Here are some of the most important:
- Liability insurance: If you provide services or products to clients, liability insurance can protect you from potential lawsuits if a client is injured or experiences damage on your premises or as a result of your work. This type of insurance can also cover legal fees and settlements if necessary.
- Professional Indemnity: This protects you against financial or legal cost in the event of a third-party claim as a result of actual or alleged negligence when providing a professional service or advice. This cover essential for professions like accountants and bookkeepers, attorneys and notaries, graphic designers, architects and civil engineers, and business consultants.
- Car insurance: If you use your personal vehicle to make business deliveries or drive clients around, you’ll need appropriate insurance. Personal insurance policies impose various restrictions and exclusions where vehicles are used for commercial use
- Portable items and building contents: If you’re a professional photographer or own an expensive laptop, you’ll want to insure them for business usage. And if you need to keep inventory for your business or specialist work equipment in your home, you may also want to name them in your insurance policy.
- Personal accident: As a freelancer or gig economy worker, you or your family typically on your own if you die or are disabled in an accident. Personal accident insurance compensates you business if you or an employee are permanently injured or killed in an accident.
Navigating the maze of insurance options
Navigating insurance options as a gig worker can be daunting. We have found that awareness of the importance of insurance is quite low among freelance and self-employed workers in South Africa. Furthermore, this isn’t a market to which large insurance companies have paid much attention in the past. It has slipped between the cracks of expensive commercial insurance and traditional home insurance, neither of which are quite right for this sector.
The good news is that some organisations are starting to offer tailored insurance options for this sector. We are, for example, seeing policies designed especially for people like plumbers or photographers as well as short-term policies for project-based professional work. Customisable coverage limits to fit individual needs as well as simpler policies that bundle multiple types of insurance coverage are becoming more common.
While being self-employed offers a level of freedom and flexibility, it’s important to ensure that you have adequate insurance coverage to protect yourself and your business. With a little research and preparation, you can find the insurance options that work best for you and give you peace of mind. And with today’s digital insurance platforms, you can answer a few quick questions, receive multiple quotes and buy online within a matter of minutes.
Bi-me (Business Insurance Made Easy) offers instant business insurance as fast as you can click. Bi-me is a trusted online platform that makes it quick, easy and affordable for small and medium enterprise owners to purchase business insurance. Companies can buy insurance specific to their sector and customised for their needs in under 10 minutes.
*This is general information only and does not take into account your financial situation, needs, or specific objectives. As with any insurance, the cover will be subject to the terms, conditions, and exclusions contained in the policy wording.