How does crowdsurance work?

Have you made plans to protect your income if you are unable to work due to illness or an accident? Many entrepreneurs opt for disability insurance (AOV). But there are less expensive options. Such as crowdsurance, in which business owners help each other when needed. You can also combine crowdsurance with AOV insurance.

What is crowdsurance?

Crowdsurance is like a mutual savings scheme. It is an insurance model in which a group of entrepreneurs help each other when unexpected events occur. If you are a member of an online crowdsurance platform, you do not pay a premium but give money directly to an entrepreneur who needs it at that moment. Are you yourself unable to work for an extended period due to illness? Then you will receive money from others for up to 2 years. You also receive guidance from an occupational health and safety service to help you get back to work as soon as possible.

Crowdsurance is similar to the idea of the donation circle, another alternative to the AOV. But with crowdsurance, you do not know the other members personally, while with a donation circle or mutual savings scheme, you often do. Also, with crowdsurance, there are no mandatory meetings.

Combining crowdsurance and AOV

You can also combine crowdsurance with AOV insurance. Crowdsurance can be an alternative to the first 2 years of an AOV. You receive money through crowdsurance for the first 2 years and after 2 years you receive money from your AOV insurer. The advantage is that the premium for your AOV is much lower due to the 2-year waiting period.

How does it work?

When you join a crowdsurance platform, you pay a registration fee. You open an account with a bank cooperating with the platform and deposit an amount into it every month. When you sign up, you decide how much income you want to insure with a maximum of 80%. You prove your income with your annual figures. The higher the income you want to insure, the more you deposit.

The platform calculates your premium based on the average illness rate. On average, members pay €130 per month for an insured income of €2,500 per month. The amount you donate to a sick member depends on the income level that member has chosen, how much you save yourself, and who the members are. The premium may be higher in an occupation where you are at a higher risk of illness or disability. 

You fall ill

A team of experts will evaluate your claim and determine the percentage to which you are unable to work. After a waiting time of 2 months, you will receive a small monthly amount in your account from each participant. All those small amounts add up to the income level you want to receive and are tax-free. The monthly deposits you make into your own account are not deductible. You should see this as your own savings.

Watch the video: Occupational disability | Managing business risks
 

Benefits

• You can join even if you have been ill in the past
• No medical examination
• You do not have to show a doctor's certificate in case of illness. But you do have an interview with a health and safety doctor (arboarts).
• You get support in your reintegration
• Donations you receive are untaxed
• Money you deposit in your own crowdsurance account remains yours
• If you stop taking part, you will receive back the amount in your account minus the crowdsurance group's administration fee.

Disadvantages

• You usually have a 2-month waiting period before you receive donations.
• Are you still ill or disabled after 2 years? You will then no longer receive donations from the crowdsurance platform. There is then no safety net except bijstandsuitkering (in Dutch, social assistance benefit). For this, your municipality considers your assets and any income of your partner.

Conditions

There are many crowdsurance platforms. Crowdsurance providers are often social enterprises. These are companies with a social purpose, where making a profit is not the most important thing. The terms and conditions of the different providers can vary widely. There is often an age limit and starting entrepreneurs can only take part after a year of being in business. Sometimes you cannot get help from the crowdsurance group if you fall ill within 1 year due to mental health reasons. 
If you want to join a crowdsurance group, it is smart to compare the terms and conditions of different providers.

Other alternatives for disability insurance

Besides crowdsurance and the donation circle, you can also opt for an AOV via an insurer or voluntary AOV via UWV. Which form suits you depends on your personal situation and wishes. In this article, you can read more about the differences and similarities between the various options.