Sickness & Self Employment

I’m self-employed and I can’t afford to be sick! That is one of the most common phrases you hear from those who are self-employed, and having being self-employed for a number of years, this has been my mantra for a long time.  It means I’ve worked through flu, stomach bugs, various aches and pains, and even with a broken foot.

That’s right!  Upon discovering that I had fractured my 5th metatarsal in my left foot, my first thought was, ‘but I’m on my way to Bristol’, my second, ‘I can’t afford to be sick’ and my third, ‘what am I going to do?  I really have broken my foot!’

It wasn’t until the doctor told me that the good news was that I didn’t need surgery, but the bad news was that I would need at least 6 to 8 weeks healing time and rest.  It later occurred to me that my health was not my primary concern; it was my work and income. The thought of rest and recuperation filled me with dread and fear, and that’s when I realised that whether I had time to be sick or not was irrelevant, it can happen at any time, and it had happened to me!

I was forced to confront my mantra, because I was right.  I couldn’t afford to be sick!

I was forced to continue to work while I healed because otherwise how was I going to survive and how would I continue to pay the bills? (Thankfully I was able to!)  But I rushed my recovery, and luckily I recovered quickly and well.  I really was lucky!
But it proved a valid point!  I was unprepared and lacked information about the impact that an accident or sickness could have all my life.

Sickness has fallen in recent years, but we still managed to lose, 131 million days to sickness absence. Unsurprisingly, the self-employed are less likely than employees to have a spell of sickness!

Self-employed workers are not entitled to statutory sick pay, however it does not mean that because you are self-employed you do not have entitlements.
Provided you have registered with HMRC as self-employed, there are a number of benefits that you may be eligible for, particularly in instances where you are unable to work and it is outside of your control.  Whilst it is necessary to prove your earnings if you are intending to claim support, you are potentially eligible for the following: –
•    Working Tax Credit if you are working full time (this could mean 16, 24 or 30 hours)
•    Housing Benefit
•    Council Tax Support if you have to pay council tax
•    Child Tax Credit and Child Benefit if you have children
•    Pension Credit if you are over Pension Credit age
•    Support with mortgage interest if you have a mortgage or home loan and are entitled to Jobseeker’s Allowance, Income Support or Pension Credit.
•    Employments Support Allowance (ESA) – (instead of SSP)
Please ensure that you check the benefits that you are eligible for.

Other options
You do have other options if you are self-employed and worried that your income could be affected by you falling ill or having an accident.  Specialist insurance policies such as key man insurance, Health Insurance plans and critical illness insurance plans could offer you peace of mind.  To learn more about which types of insurance would be most suitable for you, speak to a good independent financial adviser or wealth manager.

In other countries such as the Netherlands, there is a Mutual System of support in place between freelancer’s in order to offer support and financial relief upon their self-employed falling sick or having an accident.  However there is no compatible support model for freelancers in the UK.  Whilst this is something that is being looked into, and certainly campaigned for by many freelancer’s and self-employed UK workers, other options in the meantime include joining Ipse, a British association for the self-employed, which offers a premium membership package for £239 annually. This includes an insurance policy that pays out up to £2,000 if a member is sick for more than three weeks.

Check your options so that you can eradicate those meaningless words, ‘I can’t afford to be sick’ so at least if you are, the last thing you have to do is worry about your income.

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