Pre-existing conditions and health insurance

Finding individual health insurance is even trickier if you have a pre-existing health condition that causes insurers to shy away from offering you coverage. But you still may have options. Some states require health insurance companies to offer coverage to everyone, regardless of an individual's health status.

As part of federal health care reform legislation, U.S. citizens with pre-existing conditions who have been without health insurance for at least six months now can obtain coverage through a pre-existing condition insurance plan (PCIP).

PCIPs will be available until 2014, when health care reform legislation prevents all health insurance companies from denying coverage to adults with pre-existing conditions. A health insurance exchange program will replace PCIP at that time.

Disability insurance options

Disability insurance is another important form of protection if you are self-employed. This type of coverage replaces a percentage of your income if you become ill or are injured in an accident that prevents you from working.

Such an interruption of income is more common than you may think. Forty-three percent of all 40-year-olds will have a disability event that lasts for 90 days or more by the time they turn 65, according to the Insurance Information Institute (III).

Like health insurance, most people purchase group disability insurance through their employer. That's not an option if you're self-employed, but you can buy a policy directly from an insurance company or financial planner. These policies generally will replace 50 percent to 70 percent of your income if you no longer can work, according to III.

For more information, see "All you need to know about health insurance" and "Why you need disability insurance."