The Hartford has done a new survey and found that 25% of us have a side business that is separate from our primary source of income. Putting a real number on that percentage adds up to something close to 57 million. The insurance possibilities — as are noted as we move forward — are endless.
And while it’s good for our business, the proper insurance is also very important to these individuals.
First some information. Most side business owners do the side business for income reasons. A very small percentage do what they do out of passion. Here are some statistics:
• 49% of side business owners work 10 or fewer hours a week on the business
• 61% are employed elsewhere as well
• 51% say they have used part or all of their vacation or paid time off to work on the side business
Who owns side businesses?
• 38% of Baby Boomers
• 33% of Gen X
• 26% of Millennials
The primary reasons for starting the side business?
Overall Millennials Gen X Baby Boomers
Financial 61% 72% 62% 56%
Make a change/lifestyle 16% 18% 20% 19%
Pursue a passion 9% 7% 8% 12%
Of those surveyed by The Hartford:
• 43% of side businesses generated less that $5,000 of income a year
• 18% generated $5,000 to $10,000 a year
• 18% generated $10,000 to $30,000 a year
Here’s where insurance comes into the picture. Only 12% of the some 57 million people running side businesses have purchased insurance. Most don’t even think they need it and cited these reasons why:
• 44% — I don’t need business insurance
• 18% — my business is too small to warrant buying insurance
• 11% — my current homeowners or auto insurance covers me
As for the future of the business?
• 27% say their business is somewhat or even highly likely to become a full time job or the primary source of income
• 33% say that is highly unlikely
Another question is what is keeping that side business from becoming the primary source of income:
• 48% — I don’t believe I can make a living at this business
• 33% — I can’t afford to give up my income from my full-time job
• 27% — I don’t want to give up the benefits from my full-time job
• 23% — I like my full-time job and don’t want to give it up
• 13% — I don’t have the time to dedicate to the business
The bottom-line for the independent insurance agents of the PIA Western Alliance is that these side businesses need insurance and are often under insured.
Source link: Claims Journal