Disability insurance for freelancers: do you need it?.

What is Disability Insurance for Freelancers? 

Disability insurance is insurance which will give you a set paycheck amount in the event that you're disabled by injury or illness. You pay for disability insurance via a set monthly cost, called the "premium."

For freelancers, understanding disability insurance is important as we're the boss, the HR manager and the support system; that is, it's all on us. Since we're not offered insurance automatically through an employer, and since we're our sole and main source of income, we must act responsibly and make sure we have our own safety net in place. 

Do Freelance Writers Really Need Disability Insurance?

It's quite possible. Disability insurance is important for us, as we don’t have vacation days or sick days to lean on in the event of an injury illness or accident. 

The longer I freelance, the more I realize that traditional-employer benefits are incredible, but that we freelancers are often left hanging when it comes to that safety net.

When I was younger, I dismissed such thoughts, thinking I'd live forever, healthily. When I was in the trenches of parenting younger kids, they absorbed all these kinds of thoughts. Now that I've been an independent freelance writer for more than a decade, each little ache or near-miss accident has me thinking twice.

Statistics such as the one that this Upwork article cites make me think twice, too. DId you know that at least one in three Americans will experience a disability before they retire?  

Cost and Coverage

Before you start thinking about cost, make sure that you don't have coverage already. For example, if you're a married freelancer, your spouse may have been able to buy you a policy through their employer's insurance carrier. In addition, if you're reading this article while you're still traditionally employed, and just thinking about going freelance, check with your HR department to see if you can take a disability insurance benefit with you.  

So, what does disability insurance cover, anyway? It depends on the policy, but generally it covers about 50 to 60 percent of your income per month, meaning, if you're disable and no longer able to write, edit and run your business, your insurance would provide you with a check in that amount.

What is the cost for such coverage? This heavily depends on your age and health benefits. In my research (as a 30-something-year-old female who is healthy), I was quoted anywhere from $7 to $21 per month. 

Want to know about your own potential costs and coverages? The Freelancers Union provides a chart arranged by age and income levels.

Alternatives to Buying Disability Insurance

There are some other ways to build your own safety net as a freelance writer. Of course, you should absolutely be saving some of your income every month. Perhaps your nest egg will get you through a short disability.

You can also buy mortgage insurance through your mortgage lender. These policies vary, but basically they ensure that your mortgage will be paid in case of your inability to pay.

There are similar programs for many commercial credit cards, wherein you pay a little extra per month, and are covered in case something happens and you cannot make a payment. 

Where Can a Freelancer Get Disability Insurance?

First and foremost, if you're married and your spouse is traditionally employed, be sure to see if you can get in on his/her policy somehow. These employer-sponsored policies are often cheaper than other options. 

You can also meet with an independent insurance agent, who can show you several options from several companies. While you're with an agent, you may want to think about other kinds of insurances that freelancers need.

You may also want to see if unions or trade groups offer plans for you. For example, the disability insurance coverage provided by Freelancers Union is created for independent contractors and freelancers like us. They make the sign up process easy and the rates are decent. 

What Other Insurances Might a Freelancer Need?

Check out this article on other insurances you may need to buy independently, such as indemnity insurance, business insurance and health care coverage.

By Allena Tapia

Freelance Writing Expert