PAYE umbrella contractors and other freelancers who have put off taking out any form of income protection plan might do well to take heed of some new research from a leading cash plan provider. A survey by Medicash polled 400 self-employed people in the UK who were receiving hospital or outpatient treatment – and came up with some disquieting conclusions. On average, when a self-employed person is prevented from working due to ill health or hospital admission, he or she will lose approximately £3,000 in earnings. A third of respondents included in the survey reported an even more drastic loss of income at £5,000.

Shout 99 reports comments made by the Chief Executive of Medicash, Sue Weir, who said, “Self-employed people are particularly vulnerable if they are diagnosed with an illness and it’s worrying that so few have any sort of plan in place”. She went on to explain that many people simply “don’t take the time to think about how they would cope financially if they were unable to work and if this happens it can cause considerable strain for both individuals and their families.”

Many highly skilled people have turned to working through umbrella companies or limited companies over the last few years not simply for the better pay rates these options typically yield but to enjoy greater flexibility around work. However, illness can strike anyone, contractor or permanent employee, out of the blue. Needless to say, not having payment protection in place can add considerable hardship to what will already be an upsetting and stressful experience. Moral of the story? Get covered. Fast…

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