How to Get Life Insurance for Self-Employed Individuals

Why Term Is Probably the Best Choice for Self-Employed People

Term life insurance is often the best choice for most people because of its simplicity and affordability.

It offers a financial safety net during crucial years, like when you’re raising children or paying off a mortgage.
It offers more coverage for less premium compared to whole or universal life.
Rates are fixed, meaning they’re easy to budget for.
Can often be renewed or converted if coverage is needed after your term is over.
Policies can be customized with riders.

Riders You Should Know About

Riders are optional benefits you can choose to add on top of your base life insurance policy. They’re a convenient way to customize your coverage so it’s tailor-fit to your unique needs.

Popular riders you should consider:

Accelerated death benefit rider: This rider is typically free and automatically included on most policies. It gives you access to some amount of your policy’s death benefit if you are diagnosed with a terminal illness.
Disability income rider: This rider provides a supplementary income if you become disabled.
Waiver of premium rider: If you become disabled, this rider allows you to skip paying premiums while still keeping your coverage active.
Child rider: This rider provides a small amount of coverage on all minor children. It also provides guaranteed future insurability and is convertible into a standalone permanent policy.

A basic term life insurance policy doesn’t provide you with living benefits, as the purpose is to provide your loved ones a death benefit if you die. But certain riders will add living benefits, such as the terminal illness accelerated benefits described above. Learn more: Your Guide to Life Insurance with Living Benefits.

How to Get Life Insurance If You’re Self-Employed

Follow this simple guide to find coverage for your unique needs.

Decide Your Budget: First, figure out what you can comfortably pay for life insurance each month. Knowing your budget will help you decide on the type and coverage of the policy to get. For example, a budget of $75-200 per month will give you different options than $20-40.
Choose the Right Coverage: Decide between term life insurance or permanent life insurance.

Term life insurance: Commonly chosen because it’s easy to tailor to your budget and needs.
Permanent life insurance: Consider this if you have long-term obligations or family members relying on you for life. If traditional whole or universal life insurance seems too costly, look at guaranteed universal life insurance, which offers lifelong coverage at a lower rate without prioritizing cash value accumulation.
If you need some of both, laddering life insurance policies is a great strategy.

Free and Unbiased Assistance: If you’re uncertain about your needs, contact us at Quotacy for a free and unbiased life insurance needs analysis.
Get Quotes: Interested in term or guaranteed universal life insurance? Use our online quoting tool to instantly see prices. Experiment with different terms and coverage amounts to find a policy that suits your budget. If you’re looking for whole or universal life insurance quotes, complete this form.
Apply Online: It only takes a few minutes to fill out the online application. Once submitted, a dedicated agent will take over to guide you through the process.
Agent Assistance: Our agents specialize in finding the insurance company likely to offer you the best rate. We can provide products from various companies, and as a fiduciary, we prioritize your needs over the insurance company. You can trust us not to sell you anything unnecessary.
Underwriting Process: After submitting your application to your chosen insurance company, it undergoes a review. If approved, you’ll receive a final offer. If this price is higher than your initial quote, your Quotacy agent will help you find options that better fit your budget.

How Much Life Insurance Coverage Do I Need?

Some people like to figure things out on their own while others prefer just to ask an expert. For the latter, you can contact Quotacy for an expert needs analysis to help you narrow down how much coverage you need. For the former, this section is for you.

Coverage Amount

Determining the right coverage amount is essential to ensure that your loved ones are adequately provided for. The most important factors to consider include:

Income Replacement: How much income would your family need to maintain their current lifestyle if you were no longer there to provide?
Debts and Expenses: Consider mortgages, loans, and other financial obligations that you want to be covered.
Future Needs: Think about future expenses, like children’s education or spouse’s retirement.

For the DIY-ers, check out our free life insurance needs calculator to help determine your coverage amount.

Coverage Length

Choosing the right duration for your life insurance coverage is equally vital. The term should align with your financial responsibilities and life milestones. Key factors to think about are:

Dependents’ Age: How old will your children or dependents be at the end of the term? You might want coverage that lasts until they are self-sufficient.
Mortgage or Debt Payoff: Align the term with the time it will take to pay off significant debts, like a mortgage.
Retirement Planning: Consider how your financial picture will change when you or your spouse retire, and choose a length that matches those needs.

Is Life Insurance Tax Deductible if You’re Self-Employed?

Unfortunately, no. Life insurance premiums are not tax-deductible if you’re self-employed.

However, if you’re a business owner, there are circumstances where you might be able to deduct life insurance premiums as business expenses. Learn more here: Is Life Insurance Taxed for Policy Owners or Beneficiaries?

Tips to Get Your Best Price

Being self-employed comes with its own set of challenges, and paying for your own benefits can feel overwhelming. Fortunately, you can find ways to secure life insurance without breaking the bank. Here’s advice on how to get the best price:

Shop Around: Different insurers underwrite policies differently, so quotes can vary widely. Use an independent broker, like Quotacy, as they have access to multiple insurers and can help find the best match for your situation.
Understand Your Needs: Determine the right coverage amount and length based on your specific needs. Over-insuring can lead to unnecessary costs, while under-insuring can leave your loved ones unprotected.
Consider Your Health: Taking care of your health may help you get a better rate. Some insurers provide discounts for non-smokers, maintaining a healthy weight, or other lifestyle factors.
Buy ASAP: Buying life insurance at a younger age can make it more affordable. As you grow older, the rates tend to increase, and you might even face the risk of becoming uninsurable.

As an independent life insurance broker, our agents don’t work for the insurers, they work for you. But don’t take our word for it; see what our clients have to say. 

Compare Term Life Insurance Quotes & Apply Today

Securing life insurance as a self-employed individual is a vital step in protecting your financial future and the well-being of those you love.

We know that with so many options available, purchasing life insurance might seem daunting. That’s why we’re here to assist you in finding the right policy that aligns with your specific needs, budget, and objectives. If you’re uncertain about taking the next step, our buyer’s guide is a great place to start.

If you’re ready or at least curious about what a policy may cost, get free and instant term life insurance quotes now. Compare policies and pricing in peace. We’ll be here when you’re ready to apply.

But remember, no one knows what may happen tomorrow. If you have people depending on you, now’s the time to start the process.