Income Protection Insurance For Self Employed

Let us look at the benefits and features of income protection insurance for self employed individuals.

What Is Income Protection Insurance For Self Employed?

Unlike salaried individuals, those running self-employed businesses don't have a fixed income. Establishing or expanding such a business may require loans, which must be repaid. Repaying these loans can prove to be challenging for your family if you're no longer alive. A term life insurance plan can, therefore, address this concern, ensuring the financial well-being of your family, even in your absence.

Term Insurance for self-employed individuals is a life insurance plan designed to provide coverage for a specific period, known as the policy term. This plan offers financial protection to the nominee or beneficiary in the event of the policyholder's unexpected death during the specified policy term.

Let’s understand this with the help of an example:

Ashok, a non-smoking man of 32 years of age with an annual income of Rs. 11 Lakhs, bought a term life insurance plan (a type of life insurance) to secure his family financially. As the sole breadwinner for his family, he aimed to ensure purchasing one of the best term plans for his loved ones. After comparing various term plans, he selected the one aligning best with his preferences. Ashok opted for a 1 Crore life cover for a policy term of 30 years, committing to paying Rs. 930 per month for the same term plan tenure. Therefore, in the unfortunate event of his death, Ashok's income will be substituted by the life cover, which his nominees will receive as the death benefit.

What Are The Benefits Of Income Replacement Insurance For Self Employed?

The benefits of income protection insurance for self employed are as follows:

• Continuation of Legacy: Income replacement term plans serve as a crucial lifeline for self-employed individuals, ensuring the uninterrupted flow of their business/legacy by providing essential financial support during unforeseen circumstances.

• Financial Accessibility: With unstable incomes, an income replacement insurance plan remains a financially feasible choice for self-employed professionals, offering the necessary protection without imposing a significant strain on their budget. .

• Simplicity in Understanding: The straightforward terms of income protection insurance for self employed are designed with simplicity in mind, allowing business owners to comprehend the coverage easily and concentrate on their work without worrying about unnecessary complexities.

• Tax Efficiency: Income protection insurance for self employed individuals presents a financial advantage with potential tax benefits. The premiums paid may qualify for deductions, contributing to a reduction in overall tax liabilities and providing an additional layer of financial relief.

• Overall Family Security: Income replacement insurance plan extends beyond business considerations, ensuring the comprehensive financial security of one's family. By acting as a safety net, it guarantees that loved ones can uphold their lifestyle and meet financial commitments in the absence of the life assured individual.

*Note: You can use the term insurance calculator to calculate the premium amount of your chosen term plan.

Why is Income Protection Insurance Important for Self-Employed Individuals?

Self-employed individuals don’t have employer benefits like sick leave or group insurance. This makes it even more important to secure their income. Income protection insurance, through a term plan with monthly payouts, ensures that your family continues to receive a steady income if you’re unable to work due to illness, disability, or death.
Instead of a one-time lump sum, this plan provides monthly income, helping your loved ones manage regular expenses like rent, EMIs, and education without financial stress. It offers much-needed stability in times of uncertainty.

How To Buy Income Replacement Insurance For Self Employed From Policybazaar?

Here are the steps to buy Income Replacement Insurance for self employed from Policybazaar:

• Step 1: Visit Policybazaar’s official website and then click on ‘Term Insurance’ 

• Step 2: Fill in the basic details such as DOB, you name and other contact details

• Step 3: Then, click on ‘View Plans’

• Step 4: Mention more details about your smoking or tobacco habits, annual income, occupation and education

• Step 5: Choose the income replacement insurance plan that suits your financial needs and then proceed to pay

• Step 6: Finally, select your preferred payment method and pay to complete the purchase

*Note: It is advisable to know what is term insurance and compare first and then proceed to buy the ideal term plan.

Wrapping It Up!

For self-employed people, an Income Replacement Insurance plan is a very important financial decision. Whether you are the business owner or have dependents relying on you, safeguarding your business and ensuring family security is vital. Consider exploring term plans from over 15 insurers on Policybazaar to find the best fit for your specific needs. This allows you to select an ideal term plan that meets your requirements and offers comprehensive financial protection for your loved ones or business.

Note: You should also check the term insurance benefits if you are planning to purchase the term insurance plan.