What Types Of Insurance Are Important For The Self-Employed?
The leap into entrepreneurship takes a lot of courage. Suddenly you are solely responsible for your own payments, accidents and compensation claims. If the owner is disabled or business operations interrupted, it can have devastating consequences or even threaten the business’ survival.
Unfortunately, many small and medium-sized enterprises and self-employed people do not have an adequate insurance cover. It is, however, of vital importance to take a close look at insurance cover when starting up a new business; only then will you have the protection you need to face the future. As an entrepreneur, you will likely be faced with risks in various areas that can be minimised through insurance.
Are you self-employed already? Would you like to try it soon? Take courage: Atlanto helps you to be well protected for all eventualities and in all areas. These key areas are discussed below.
Let’s Review
Pension provision in Switzerland is based on the three-pillar principle. The first pillar consists of old-age and survivors’ insurance (OASI). A share is deducted from the employee’s salary and an equal share is paid by the employer. The same applies to the second pillar, the pension fund and accident insurance. One part comes from the employee, the other from the employer. Payments to the third pillar are voluntary and are therefore called “private pension provision”. Individuals can make their own savings contributions in so-called 3A accounts, which are paid out to them when they retire.
Make Your Own Provision For Retirement
As you can see, a large part of the pension provision is organised by employers. Self-employed persons must thererfore take care of their own pension provision and that of any employees. How this works depends entirely on the legal form of the company.
In the case of a public limited company (SA) or a limited liability company (LLC), occupational pension provision is organised via a pension fund solution. This is because LLC and SA are considered legal entities. The respective founders count as employees of these legal entities and the pension scheme is organised accordingly.
That is not the case with private companies. As they have no employers, entrepreneurs must organise their own pension provision. By law, they are only obliged to contribute to the first pillar (OASI). To do this, they must register with the cantonal compensation office.
Payments into pillars 2 and 3 are theoretically voluntary. Nevertheless, they are extremely important for entrepreneurs. Pillar 2 not only pays benefits in old age but also in the event of your inability to work and to surviving family members in case of death. It is therefore definitely advisable to join a pension fund, for example. Some trade associations have their own pension fund. Payments into Pillar 2 and Pillar 3a can be deducted from taxable income.
Necessary Insurance
However, good insurance does not end with a pension fund. After all, the self-employed take major financial risks with their company and should protect themselves comprehensively. There are various types of insurance that should be taken out to protect the company. Here are some examples.
- Daily Allowance Insurance (KTG)
In the event of illness, you may find yourself absent from your work for days – in some cases even longer. For the self-employed, however, absence from work means absence of pay, which could quickly become dangerous. To avoid this risk, take out a daily allowance insurance. This type of insurance pays a compensation for wages lost due to illness.
- Accident Insurance (UVG)
An accident, whether at work or in your free time, can result in high costs. Accident insurance provides financial support by covering the costs of medical treatment and rehabilitation. It also provides assistance in the event of incapacity for work or disability.
- Liability Insurance
Liability insurance is essential for a company. If customers or others are injured, or if third-party property is damaged while you are conducting your business, such insurance covers the costs of compensation or legal defence.
Professional liability insurance is a special type of such insurance. This protects against claims for damages due to negligence or errors, which can be devastating in certain industries. Doctors, consultants, architects and engineers can particularly benefit from such protection and should take out such insurance.
Package Solution For Specific Risks
Fire, water or natural forces such as flooding, and inundation can have catastrophic consequences. If the repair work takes too long, customers switch to the competition. You need tailored insurance solutions to cover yourself against lengthy operational downtimes. Liability claims and damage caused to goods in transit can also have serious financial consequences, as can a break-in. With a needs-based package solution, small enterprises can insure themselves against some of the key risks of their everyday business. Relieved of this worry, you can free up resources to concentrate on your core business. Some of the key elements of such a package solution include the following:
- Insurance to cover loss of income in the event of business interruptions
- Professional and public liability insurance to cover damage to third parties.
- Movable property insurance to cover damage to business furnishings
- Buildings insurance to cover properties owned by the SME
Other important additions include:
- Transport insurance to cover damage to delivered goods
- Cyber insurance to cover damage resulting from cyber-attacks
- Legal expenses insurance to assert or defend claims in court
But the insurance policies also depend greatly on the nature of the business activities. Some insurers offer a risk advisory service, making it possible to offer an optimum package solution from a single source.
Do you still have questions about your insurance or pension provision? Then contact us at info@atlanto.ch. We will find the right SME advice for you with our partner Helvetia Insurance. For more advice on insurance and entrepreneurship consult our blog.
