Last modified:Wednesday 3 July 2019
With a company, just as in your personal life, not preparing for the worst can be very expensive: damage, accidents, disasters of all types, all may be a nasty surprise in the best of cases; in the worst cases, they may lead to the closure of your company. Of course, it is not possible to defend against everything; a good number of insurances are also "optional", but the law requires a series of obligations...
Which insurances are compulsory for self-employed workers and liberal professions?
Covering the risks for yourself is a choice that you can make knowingly (or not), but the law sets out a certain number of obligations when it comes to liability towards third parties (your customers, your workers, etc.). But which insurances?
Civil liability motor vehicles
Whether you own just one or several vehicles, vans or not, both in your professional and personal life, the subscription of civil liability car insurance is required by law. In case of an accident, all damages caused to third parties are covered. Of course, there is nothing to stop you from covering damage caused to your own vehicle as well, but this coverage is optional. Among the optional insurances related to vehicles, you can even choose to take out driver’s insurance, foreign travel insurance, a policy covering any goods transported, or even "legal protection" which helps cover the costs related to your legal defense.
Occupational accident insurance
If you employ personnel, you must take out insurance for accidents at work. The idea is obviously to cover your workers in case an accident occurs during their work, in the workplace, or even on the way to work. Your social secretariat for employers may arrange this for you. If you "opt out" of this insurance, the worker will still be indemnified by the Fund for Occupational Accidents that will later claim the full amount paid by the victim back from you, the employer.
Civil liability in case of fire or explosion
If your activity is carried out on premises accessible to the public, damage to persons or property of third parties (by a fire, explosion, etc.) engage your liability, whether you are to blame or not! This is the notion of objective liability. Such an insurance is mandatory for premises accessible to the public (catering establishments, retail stores, etc.)
Professional liability insurance
For some occupations as accountants, medical staff, and architects, an extra public liability or professional errors and omissions insurance is needed or even compulsory. Professional liability insurance provides cover in the event you cause damage or loss to third parties or your clients as a result of professional errors.
And is this (already costly) minimum sufficient?
To ask the question is to answer it: beyond these legal insurances, there is a huge range of more or less essential insurance products, such as operating loss insurance, equipment breakdown insurance, etc. It is up to you to determine the risks present, the consequences that may arise therefrom, and the price you have to pay to minimize the impact!
Property insurance protects your property; that is to say, the assets related to your company. In principle, you are insured against a fire or explosion. But what happens if a skylight is damaged by hail, if vandals destroy your goods, or even if fresh foods perish in the refrigerators following a power cut? This is the purpose of operating loss insurance. It not only covers the goods damaged, but also the impact of the incident on your business.
If your production, your sales, or your services are temporarily suspended following a fire, you lose your source of income. But your operating costs (salaries, rents, loan repayments, etc.) do not disappear. Not only does operating loss insurance cover these permanent costs, it also covers additional costs: for example, the temporary lease of another property or the obligation for third parties to help with current orders. The operating loss insurance is a customized policy based on the sector and the self-employed worker's activity, because each case is different. A good broker will advise you effectively by identifying the risks you are perhaps unaware of and will suggest solutions to cover them. The decision is yours...
As a self-employed worker, you are indeed entitled to social security, but you know that this system often offers poor coverage. Life insurance, disability insurance, and guaranteed income insurance cover these risks that you are exposed to as a natural person, allowing you to maintain your lifestyle during a period of illness, or after an accident.
The «guaranteed income" insurance in case of work disability, for example, pays out a replacement income for a determined period - after a waiting period to be determined (generally one month). Knowing the limits of the social status of self-employed workers, this insurance is very tempting, but expensive. When you exercise your activity within a company, this guarantee can be partially covered by a group insurance policy which is more advantageous. Again, a good broker will help you make the right decision.
But how does one navigate this jungle ?
It is not unusual for an entrepreneur (as well as an individual) to have several overlapping insurance policies covering the same risk several times, while other risks are left uncovered.
Under insured or over insured? Both are a waste of money. More than even, the certified insurance broker is becoming an essential partner, so choose wisely. Of course, we need to use them less than we do an accountant, for example. However, the consequences of a poor decision are sometimes disastrous!
Good to know: avoid the black list...
The "black list" means the RSR file ("special risks") containing the details of people representing "special risks" in terms of insurances. For insurers, a risk is special when it is clearly higher than the average risk calculated statistically for a given category or group of risks.
In principle, insurers cannot exclude you purely and simply based on the sole reason that your name appears in the RSR file. However, they may apply pricing policies meant to deter you.
In 95% of cases, people on this list are there due to missed payments, a very high number of claims, or even due to a false declaration when subscribing to an insurance policy, or following an accident (registered as "increased risk").
Records due to non-payment of premiums are conserved for 3 years. All other types of records are conserved for 5 years unless they concern an "aggravated risk", in which case they are conserved for 10 years.
Datasur is obliged to inform you of your record, which you can choose to contest with Datasur in the first instance, and then with the insurance mediator if necessary.
Want to know more?
To find out more about the different insurances and the essential partners such as brokers, see the websites of Assuralia (professional union for insurance companies) and Feprabel (federation of insurance brokers and financial intermediaries in Belgium).