Insurance for the self-employed in Mallorca

When you work for yourself, you and your business are the same thing: if you cannot work, no money comes in; if a client makes a claim, your own assets are on the line. Well-planned insurance for the self-employed protects four things: what you might cause to others, your premises and tools, your income if you cannot work, and your future when you stop. Here is a practical guide, with frequently asked questions at the end.

What insurance does a self-employed person usually need?

You do not have to buy everything at once. A sensible approach is to prioritise by activity and stage: starting out is not the same as ten years in.

Liability: the first thing to review

Any professional activity can cause harm to someone else: a job done badly, a client injured on your premises, a mistake in advice. Liability insurance covers, within the agreed limits, the compensation claimed from you and your legal defence. There are packages for small businesses and the self-employed, and a professional version for those whose services can have financial consequences if something goes wrong.

It is not always compulsory, but sometimes a client, a professional body or a lease asks for it. Check what limit the other party requires before choosing.

Your premises, tools and stock

If you work from a shop, workshop or office, trade insurance or multi-risk protects contents, fittings and, depending on what you take out, operations liability. Look at three things:

• That the sum insured reflects real value, including tools and IT equipment.
• That stock is included, if you sell or store products.
• What happens if you cannot open after a claim, for example temporary premises, depending on the policy.

If you work from home, a home insurance policy alone may not cover professional equipment. Check the conditions and ask us.

If you cannot work: the incapacity allowance

This is the cover people talk about least, and the one that changes a bad period for many self-employed workers. An accident or illness that stops you working for weeks or months means fixed costs keep arriving: contributions, rent, suppliers. Even when a public temporary incapacity benefit exists, it may not match the real drop in a freelancer's income.

Accident and/or illness allowance insurance is designed to offset lost income or higher costs arising from temporary incapacity or a hospital stay. The duration and amount depend on the policy, so read the conditions carefully.

Accident, death and disability

Accident policies can cover death or permanent disability due to accident, with additional covers you choose: medical care after an accident, temporary disability and others. They can be taken out for work only, for 24 hours or for a specific activity. If you have dependants or a mortgage, this layer deserves a look. See health and accidents and life.

Private health insurance

Many self-employed people take out health insurance to avoid waiting times and choose a specialist. Before comparing prices, think about the doctors' network, co-payments, waiting periods and family members included. See our health insurance page.

Can I deduct insurance as a self-employed person?

In general terms, insurance expenses linked to the professional activity may be treated as expenses, while personal policies are usually treated differently. It depends on the type of policy, how it is taken out, your tax regime and the rules in force each year, so check with your tax adviser before claiming a deduction.

We explain the most common cases in our article What insurance policies can I deduct as a self-employed person in Spain? (also available in Spanish: seguros deducibles para autónomos).

Retirement and savings when you work for yourself

Savings and pension plans are two different tools, with different access to your money and different tax treatment. We have summarised the differences on our savings and pensions page. No promises of returns: what matters is starting with a contribution you can sustain.

Questions to ask before signing any policy

1. What activity is on the policy? If you added services, make sure it is stated.
2. What is the limit of indemnity, and does it apply per claim or per year?
3. What excess do I pay in a typical claim?
4. What is excluded? Read exclusions and waiting periods, if any.
5. How are claims handled and who do I call?

Bring your current policies and we will review them with you, with no obligation.

Where to start according to your stage

• You have just registered: liability, cover for your premises or tools and accident insurance. This is the reasonable minimum.
• Your business is growing: review sums insured, add the incapacity allowance and start saving for retirement.
• You have employees: add employer's liability and people cover for your team (see business insurance).
• Your activity is marine, transport or otherwise specific: see nautical insurance and transport insurance.

Where to find us

Visit us in Palma (Avenida Compte Sallent, 20 bajos, tel. 971 72 04 43), Inca (calle Bartomeu Coc, 14, tel. 971 88 35 25) or Sóller (calle de Bauzá, 6, tel. 971 63 34 78), call 971 72 04 43 or use the contact form.

Insurance for the self-employed: FAQ