Choosing to go self-employed is a huge leap, and can be a risky move – particularly when giving up a job in a difficult employment market. However, it’s a move that can pay off handsomely, should things go your way.

You can increase the odds of making a success of your self-employed status, by heeding the two ‘P’s’:

Protection

Unless you’re planning on setting up a LTD company, then your business and you will become financially intertwined. This means that you will be personally responsible for any business debts, should you run into difficulties.

insurance

One thing that has the power to destroy a small business is a compensation claim in the case of unintentional accident, injury or damage. For example, should a customer slip on your wet floor, or a contractor injure themselves while working on your premises, it is likely to be your responsibility. A responsibility which could become very expensive should the injured party take you to court (which is easy to do with the many Claims Management Companies operating on a no win, no fee basis).

Hiscox liability insurance for self employed individuals provides vital protection, and will cover the cost of expensive compensation or legal fees which you would otherwise be personally liable for.

Preparation

It’s impossible to be ‘too prepared’ when it comes to going it alone, and you shouldn’t rush the early stages of planning your business. Business Minister Mark Prisk has been quoted as stating that 70 per cent of SME’s (small and medium business enterprises) applying for finance don’t have a business plan. This is clearly a huge error on the part of many new business owners as a business plan is an essential tool for a business’s inception, growth and development.

The benefits of being self-employed are numerous – and the feeling of being your own boss is truly fantastic. Ensure that you prepare and protect yourself and your new business properly to stand the best chance of success.