Is PPI worth it for the self-employed?

If you are self employed or on a contract, you do need to be careful when buying Payment Protection Insurance (PPI). Some policies simply do not cover you if you are self-employed.

While some PPI policies do offer cover, one thing you need to bear in mind is that you will not be eligible to claim simply because there is less work around and you are struggling financially.

You really need to check thoroughly with your chosen PPI provider for any exclusions and the type of cover offered for the self-employed.

Normally, for a claim to be valid, you will need to show you that because you could not find enough work, you have involuntarily ceased trading. You will also need to show that you have advised the Inland Revenue that you have ceased trading.

You will not be covered for voluntary insolvency.

You should note that should you still have any sort of income coming in, you may not be eligible to claim.

If you are a contract worker there are some plans that will offer cover. However, you do need to be clear what the terms and condition are before you buy.

Simon Burgess from specialist protection provider BritishInsurance.com says: “Be very careful of policies that offer cover for the self-employed or those on a contract. Check and double-check for any exclusions and the suitability of the policy for your circumstances

“Sadly, many self-employed people take out unsuitable PPI policies and then find that they are ineligible to claim when it is too late”.