Insurance for Self-Employed: Mandatory, Recommended & Optional

As a self-employed person, you bear not only the entrepreneurial risk but also the personal insurance risk — because many benefits that employees automatically receive through their employer are not available when you are self-employed. An accident, illness or liability case can quickly become an existential threat without adequate insurance coverage. This article provides you with a structured overview of all relevant insurance policies: What is mandatory, what is recommended and what is optional?

01Overview: Mandatory – Recommended – Optional

The following table gives you an at-a-glance view of which insurance policies you need as a self-employed person in Switzerland — ordered by priority:

02Mandatory Insurance

Health Insurance (KVG)

Basic health insurance under KVG is mandatory for all residents in Switzerland — regardless of employment status. As a self-employed person, you pay the premium entirely yourself. The employer does not contribute to basic insurance for employees either (this is private even for employees), but the difference lies in the lack of continued salary payment in case of illness.

Important for self-employed persons: KVG basic insurance covers medical and hospital costs but does not pay daily sickness allowance during incapacity to work. This means: If you are ill and cannot work, you have no income replacement without additional insurance.

OASI/DI/APG

Contributions to OASI (Old-Age and Survivors' Insurance), DI (Disability Insurance) and APG (Loss of Earnings Compensation) are mandatory for all employed persons. As a self-employed person, you pay the entire contribution alone (for employees, employer and employee each pay half). The contribution rate for self-employed persons is between 5.371% and 10.6% of net income (degressive scale). In addition, Pillar 3a is an important building block of private retirement provision.

DI benefits are particularly important for self-employed persons: In case of permanent disability, you receive a DI pension. However, the DI pension only covers the subsistence minimum — it is often insufficient for an adequate standard of living. Therefore, supplementary coverage through voluntary BVG or private disability insurance is recommended.

03Recommended Insurance

Accident Insurance (UVG – voluntary)

According to UVG Art. 4 Para. 1, self-employed persons are not mandatorily insured against accidents. As an employee, you are automatically insured against occupational and non-occupational accidents through your employer — as a self-employed person, this coverage does not apply. However, you can voluntarily insure yourself through SUVA or a private accident insurer.

Without UVG, you are only covered by KVG basic insurance in case of an accident. This covers treatment costs but pays no daily allowance for incapacity to work and no disability pension. In case of serious accidents, this can be existentially threatening.

Daily Sickness Allowance Insurance

Daily sickness allowance insurance replaces your income when you cannot work due to illness. Unlike employees, who receive at least 3 weeks (in the 1st year of service) to several months of continued salary payment, as a self-employed person you have no entitlement to continued salary payment. From the first day of illness, your income is missing.

There are two types of daily sickness allowance insurance:

• Under KVG: Guaranteed acceptance (no health questionnaire), but higher premiums and shorter benefit duration (typically 720 days)
• Under VVG (private law): Health check required, but lower premiums and more flexible conditions. Benefit duration usually 720 or 730 days

Professional Liability Insurance

Professional liability insurance protects you when you cause financial damage to a client through your professional activity. The legal basis is OR Art. 41 ff. (liability from unlawful acts) and OR Art. 97 ff. (contractual liability).

Professional liability insurance is particularly important for:

• Consultants and trustees (incorrect advice)
• IT service providers (data loss, system failures)
• Architects and engineers (planning errors)
• Graphic designers and web designers (copyright infringements)
• Therapists and coaches (treatment errors)

The coverage amount should be at least CHF 1'000'000 — for consulting-intensive activities rather CHF 2'000'000 to CHF 5'000'000. Premiums typically range from CHF 300 to CHF 2'500 per year, depending on the industry and coverage amount.

Legal Protection Insurance

Legal protection insurance covers the costs of legal disputes — for example in disputes with clients, suppliers or authorities. For self-employed persons, commercial legal protection is relevant, covering contract, rental and employment law.

Costs range from CHF 400 to CHF 1'200 per year. Note the typical waiting period of 3 months after contract conclusion — take out the insurance early, not only when a conflict is foreseeable.

04Optional Insurance

Business Interruption Insurance

This insurance covers the loss of earnings when your business is temporarily shut down due to an insured event (fire, water damage, burglary). It is particularly relevant for self-employed persons with physical business premises — e.g. workshops, practices or catering businesses. For pure service providers working from home, it is less relevant.

Cyber Insurance

With the new Data Protection Act (DSG), which has been in force since September 2023, data protection violations also have criminal consequences. Cyber insurance covers costs for data recovery, extortion (ransomware), notification costs for data leaks and potential liability claims.

For self-employed persons who work with sensitive client data (e.g. trustees, doctors, lawyers) or whose business is highly digital, cyber insurance can be worthwhile. Costs: CHF 200 to CHF 1'000 per year.

Property Insurance (Business Inventory)

Property insurance covers damage to your business inventory — office equipment, tools, stock. If you have expensive equipment or larger stock holdings, this insurance is worthwhile. For typical freelancers with a laptop and little physical inventory, it is less urgent.

05Prioritisation on a Tight Budget

Especially in the start-up phase after setting up your sole proprietorship, the budget is often tight. The following prioritisation helps you cover the most important risks first and build up insurance costs step by step:

06Tax Deductibility of Insurance Premiums

As a self-employed person, you can deduct all business-related insurance premiums as operating expenses from your taxable income (DBG Art. 27). This includes:

• Professional liability insurance: Fully deductible
• Legal protection insurance (commercial portion): Fully deductible
• Business interruption insurance: Fully deductible
• Cyber insurance: Fully deductible
• Property insurance (business inventory): Fully deductible
• Voluntary UVG premium: Fully deductible
• Daily sickness allowance insurance: Fully deductible (if taken out as a business policy)

Health insurance (KVG), on the other hand, is claimed as a personal deduction in the tax return (not as a business expense). OASI/DI/APG contributions are deducted directly from business profit, thereby reducing taxable income.

07Managing Insurance with einzly

Insurance premiums are a significant cost item for self-employed persons — and at the same time a tax deduction. einzly helps you keep track:

• All premiums recorded: Post insurance premiums as business expenses — with receipt and the correct category
• Tax overview: See at any time how much you have paid in business insurance and how it affects your profit
• Deadline reminders: einzly reminds you of upcoming payments and contract renewals
• Year-end closing: All insurance costs are cleanly documented — ready for the tax return or your trustee

08Frequently Asked Questions about Insurance for Self-Employed