Running your own business or freelancing gives you independence - but it also means no corporate
insurance safety net.
That’s why term insurance for self-employed professionals is essential. It protects your
family’s
lifestyle and your business from financial disruption in your absence.
Even without a fixed salary, you can qualify for large coverage (₹1-₹5 crore or more) by showing income
proof through ITRs or business records.
Insurers like HDFC Life, ICICI Prudential, and Max Life now offer flexible term plans
for entrepreneurs, traders, consultants, and freelancers.
Why Self-Employed Need Term Insurance
- Protect Business Loans & Liabilities - Ensure debts don’t pass to family.
- Stabilize Family Income - Replace your irregular earnings with fixed protection.
- Business Continuity - Helps partners or successors manage finances.
- Tax Efficiency - 80C and 10(10D) benefits on premiums and payouts.
- Legacy Planning - Transfer wealth seamlessly to dependents.
Eligibility For Self-Employed Buyers
| Criteria |
Requirement |
| Age Limit |
18-65 years |
| Income Proof |
ITR (2-3 years) or CA-certified income |
| Occupation |
Professionals, business owners, freelancers, traders |
| Minimum Annual Income |
₹3-₹5 lakh (varies by insurer) |
| Documents Needed |
PAN, Aadhaar, GST (if applicable), ITRs, bank statements |
| Medical Test |
Mandatory above ₹50L coverage |
How Term Insurance Works For Self-Employed
- Coverage based on declared annual income and financial exposure.
- Insurer uses your ITR or business turnover to determine eligibility.
- You choose cover (usually 10-20× your annual income).
- Premiums are fixed; coverage continues regardless of business ups and downs.
Sample Premium Comparison
| Profile |
Sum Assured |
Term |
Annual Premium (₹) |
| Freelancer, age 30 |
₹1 Cr |
30 yrs |
₹10,500 |
| Business Owner, age 35 |
₹2 Cr |
25 yrs |
₹21,000 |
| Consultant, age 40 |
₹1.5 Cr |
20 yrs |
₹18,200 |
| Trader, age 45 |
₹1 Cr |
15 yrs |
₹23,800 |
(Indicative; based on average ITR ₹8-₹12 lakh.)
Documents Accepted As Income Proof
- ITR (last 2-3 years)
- CA-certified net income certificate
- Bank statements (6-12 months)
- GST filings or audited business balance sheets
- Professional registration certificate (for doctors, CAs, lawyers)
Top Term Plans For Self-Employed
| Insurer |
Minimum Income |
Max Cover |
Unique Feature |
| HDFC Life Click 2 Protect Super |
₹5L |
₹50 Cr |
Whole-life & limited pay options |
| ICICI Prudential iProtect Smart |
₹5L |
₹25 Cr |
Easy ITR-based underwriting |
| Max Life Smart Secure Plus |
₹4L |
₹25 Cr |
Business-owner friendly terms |
| Tata AIA Sampoorna Raksha Supreme |
₹5L |
₹50 Cr |
Flexible income payout mode |
| SBI Life eShield Next |
₹3L |
₹10 Cr |
Simplified ITR acceptance |
Riders Recommended For Entrepreneurs
- Critical Illness Rider: Covers health risks that could affect your business.
- Accidental Death Benefit (ADB): Double cover for business travel risks.
- Waiver of Premium (WOP): Keeps plan active if disabled or ill.
- Key-Person Rider: For business partners or co-founders.
Benefits For Business Owners
- Cover business liabilities or partner obligations.
- Secure loans against term plan value (in limited-pay variants).
- Create liquidity for heirs or partners.
- Prevent asset liquidation during succession.
- Protect family and employees from sudden business disruption.
Local Insights
- Avg. coverage for self-employed: ₹50,00,000.
- Top professions buying term plans: Traders, doctors, consultants.
- % of applications approved without salaried proof: 82%.
- Most selected insurers for freelancers: HDFC Life, ICICI Prudential.
Tax Benefits
- Section 80C: Deduction on premiums up to ₹1.5 lakh/year.
- Section 10(10D): Payouts to nominee are tax-free.
- Section 80D: Deduction on Critical Illness Riders (₹25k-₹50k).
- Business Expense Benefit: If policy covers key-person, premium deductible under
Section 37(1).
FAQs
Can self-employed people get term insurance?
Yes, by providing ITRs or CA-certified income proof.
Do I need salary slips to apply?
No - ITR or audited accounts are enough.
What coverage can I get as a business owner?
Usually 10-20× your average annual income (₹1-₹50 crore).
Can I include business partner as nominee?
Yes, if insurable interest exists (e.g., co-owners).
Are business expenses covered by term plan?
No, but payout can be used by heirs to settle debts or expenses.
Is medical test mandatory for self-employed?
Yes, especially for large covers.
What happens if income fluctuates yearly?
Insurers use average ITRs (past 3 years) to decide coverage.
Can freelancers apply without ITR?
Some insurers accept bank statements or CA certificate if ITR unavailable.
Can I pay premium through business account?
Yes, if policy is registered under company name (for key-person insurance).
Can I buy online term plan as self-employed?
Yes, PolicyBachat allows digital KYC and online document upload.
Can I take multiple term plans for business and personal use?
Yes, both can coexist with different nominees.
What’s the ideal plan for professionals (doctors, lawyers)?
Plans with CI and ADB riders - protect both income and practice.
Do insurers verify business documents?
Yes, via ITR validation and GST registration.
Which payment option suits best?
Limited pay (5-10 years) - finish payments early during peak income years.
Can NRIs running businesses in India buy such plans?
Yes, via online KYC and foreign medical underwriting.
Customer Reviews
- “I'm a freelancer - got ₹1 Cr cover with just ITR upload.” - Naveen Reddy,
Hyderabad
- “Perfect for small business owners - no salary slips needed.” - Ravi Patel,
Ahmedabad
- “PolicyBachat verified my CA income proof - smooth approval.” - Anita Shah,
Delhi
- “Excellent rider options for entrepreneurs.” - Rohit Kumar, Bengaluru
- “Now my business loan is fully protected.” - Sameer Mehta, Pune
- “Loved the digital process for self-employed folks.” - Neha Thomas, Kochi
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