Can You Be Self-Employed Without Insurance?

  • John A. Osborne
  • Dec 23, 2022
Small Business Insurance Hawaii

Being self-employed can be a liberating experience, allowing you to be your own boss and work on your own terms. However, one of the biggest challenges of being self-employed is the lack of benefits that come with traditional employment, such as health insurance. If you are considering going the self-employment route, you may be wondering if you can be self-employed without insurance. The answer is yes, but it’s not recommended.

Without insurance, you may be putting yourself and your business at risk. A sudden illness or injury could lead to significant medical bills, which can quickly drain your savings and put you in debt. In the long term, being uninsured can also limit your access to healthcare, making it harder for you to maintain good health and productivity.

What are the risks of being self-employed without insurance?

While it is possible to be self-employed without insurance, it is not advisable. Here are some of the risks associated with being uninsured:

  • Medical bills: Without insurance, you will be responsible for paying for all your medical bills out of pocket. This can be a significant expense, especially if you need hospitalization or surgery.
  • Reduced access to healthcare: Uninsured individuals often have limited access to healthcare, as they may not be able to afford preventative care or regular check-ups. This can lead to undiagnosed health problems that can become more serious over time.
  • Financial strain: Medical bills can be a significant financial burden, and can quickly drain your savings or put you in debt. This can put a strain on your personal finances, as well as your business.
  • Increased risk: Without insurance, you may be more likely to take risks with your health, as you may avoid seeking medical care due to cost concerns. This can lead to more serious health problems down the line.

What are your options for health insurance as a self-employed individual?

While being uninsured is not recommended, there are several options available for self-employed individuals to obtain health insurance:

  • ACA Marketplace: The Affordable Care Act (ACA) marketplace offers a range of health insurance plans for self-employed individuals. You can shop for plans on the website, and may be eligible for subsidies to help cover the cost of premiums.
  • Private insurance: You can also purchase health insurance directly from a private insurance company. This can be more expensive than an ACA plan, but may offer more flexibility in terms of coverage options.
  • Group insurance: If you have employees, you may be eligible for group insurance plans that can provide coverage for you and your employees.
  • COBRA: If you have recently lost your job, you may be eligible for COBRA coverage, which allows you to continue your employer-sponsored health insurance for a limited period of time.

What are some other benefits of having health insurance as a self-employed individual?

Aside from the obvious benefit of having access to healthcare, there are several other benefits of having health insurance as a self-employed individual:

  • Tax deductions: You may be able to deduct the cost of your health insurance premiums from your taxes as a self-employed individual.
  • Peace of mind: Knowing that you have health insurance can provide peace of mind, allowing you to focus on your business without worrying about the financial implications of a sudden illness or injury.
  • Improved productivity: Good health is essential for productivity, and having access to preventative care and regular check-ups can help you stay healthy and productive.
  • Attracting clients: Offering health insurance as a benefit can be a valuable selling point for potential clients, helping you stand out from the competition.

The Bottom Line

Being self-employed without insurance is possible, but it is not advisable. The risks of being uninsured can be significant, including medical bills, reduced access to healthcare, financial strain, and increased risk. Fortunately, there are several options available for self-employed individuals to obtain health insurance, including the ACA marketplace, private insurance, group insurance, and COBRA. Having health insurance can provide peace of mind, improve productivity, and even help attract clients.

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