As a Freelancer in Belgium, you are less well protected than an employee. Thus, it is up to the Freelancers to protect themselves as well as their business activity. Fortunately, there are many possibilities to insure yourself in Belgium. It is important to remember that every Freelancer is different and so are the risks incurred. Therefore, there is no standard package of insurance products for Freelancers. However, you can combine multiple products to cope with your risk level.
The mandatory insurances for Freelancers
Professional liability insurance
Professional Liability insurance is mandatory for most fields of freelance business activity. First, you have to find if your job as a freelance requires this insurance. For example, you have to subscribe if you are working as a business consultant, legal consultant, as an accountant or as a web developer or in the ICT. Why? In case of a professional error, your clients may claim for a financial compensation for the damages. In order to protect yourself against such a risk, all you need to do is to subscribe to a professional liability insurance.
Operating liability insurance
Operating liability insurance protects you against material damage caused to third parties during your professional activity. For example, you could damage your client’s server during your intervention or break a computer. This kind of event should not be neglected, because a common server failure can cause a complete shutdown of a company (causing temporary unemployment or a loss of turnover).
Protect your employees
You are a Freelancer and you are hiring employees for your company? You might be considering hiring a secretary, an administrative assistant, a social media manager, etc. In this case you will be legally obliged to insure your employees to protect them against work accidents.
Car insurance
It may be obvious for you but if you use your private car for your professional activity (typically representing 50% of its usage), it is compulsory to subscribe to a professional insurance for this car. Else, the insurance company, may argue that it was not covered according to the true risk, hence refusing to pay off the damages you may have caused. Make sure with your insurance broker that your current insurance offers a full coverage!
Insurances for legal aspects of your freelance business
Legal expenses insurance
You may know that legal procedures in Belgium are expensive. As a Freelancer, there are many reasons for using a legal help. For example, unpaid bills by your client, abusive breaches of contract, customers who engage your responsibility, and so on. But you may not have the means to hire a lawyer and start all these expensive legal procedures. Thanks to the legal protection insurance you will have access to free legal advice and even free representation by a lawyer in criminal and civil cases. However, please pay attention to the different cases of exclusion and do not hesitate to consult your insurance broker.
E-reputation insurance
Your reputation on the Freelancing market is one of your greatest tools. It allows you to retain your clients and acquire new ones. However, sometimes people can attack you on the Internet and damage your reputation. Thus, if you are undergoing denigration, insults, defamation or harmful content, this insurance product gives you access to personalized legal advice and will guide you through the legal procedure to remove this content from the Internet.
Tax protection insurance
Tax procedures in Belgium are often very complex and thus unfortunately, an error can easily be committed (by the administration as well as by your accountant). In order to shield yourself against this risk and avoid having a negative impact on your business activity, you can subscribe to a Tax Protection Insurance. This insurance will cover the expenses of legal procedures in case of legal disputes.
Insure yourself and your income
Hospitalization insurance
Hospitalisation insurance for Freelancers covers your medical expenses: hospital stays, medical examinations and medical treatments. This insurance allows you to benefit of up to 3 times higher reimbursements than the ones offered by the social security. In case if you are working as a sole-trader, your Hospitalisation insurance is the same as your private insurance. However, if you own your own company, you will have to subscribe to a Group Hospitalisation insurance.
Guaranteed income insurance
As you know, when you are a Freelancer, if you stop your professional activity, you won’t have any income. But sometimes, it is not your choice to stop your activity: you can get sick, or you can have an accident. To avoid such inconveniences, you should subscribe to a Guaranteed Income insurance. This insurance allows you to maintain all or a part of your income according to the plan to which you subscribe. You will thus receive a monthly indemnity, in addition to an indemnity from your mutual insurance company. Another alternative to this insurance is a turnover insurance that is based on your company's turnover. However, the turnover insurance is most often much more expensive than the guaranteed income insurance.
Prepare your retirement by insuring your future income
Currently, the pension for Belgian Self-Employed persons ranges between 800 to 1000€ gross per month, which is well below the poverty line for singles. However, alternatives are available for Freelancers. Indeed, in order to insure and protect your future and your future income, you can take out an insurance policy to complete your pension. These insurances are called life insurance. In addition to helping you plan your retirement, life insurances also offer you interesting immediate tax breaks.
The possibilities of building up a pension depend on the legal form chosen by the Freelancer, i.e. As a company; or as an “individual person”.
In companies, the 2 specific insurances that are strongly recommend for the pension of Freelancers are the PLCI and EIP.
These 2 insurances allow Freelancers to complete their legal pension and to benefit from interesting tax incentives. These 2 products are complementary and allow you to increase your pension. As a Freelancer, you will start by filling in your PLCI (the product that has a better return than the EIP but has a ceiling of 3,290 EUR) then your EIP (which has a slightly lower return but doesn’t have any contribution ceiling). The estimated yield for a Freelancer that started his or her contract at the age of 40 is around 7% for a PLCI and 6% for an EIP, taking into account the tax benefits and branche 21 returns.
Having some additionnal questions or need more precisions?
Do not hesitate to contact our partner Seraphin, the Belgian digital broker specialized in the freelance market. As a member of the i-Lance Community, you can request a free consultation and benefit from the advantageous conditions negotiated for you.
You can book your private consultation directly here
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