When you start a business, you’re full of hope and dreams. The last thing you want to think about is what would happen to your business if you, a co-owner, or a key person within the business were to become disabled or – God forbid – die.
But, as a business owner it is your responsibility to think about these things and plan how you will protect your business, your employees, and your family in the event of one of these tragedies. In order to do that, you need to ask yourself these two questions and then get the proper business insurance to meet your needs:
Here are 4 Types of Business Insurance to Consider:
Disability Buy-Out Insurance
Business Overhead Insurance
If an owner were to become disabled, this insurance would reimburse the business for overhead expenses – such as salaries, taxes, employee benefits, rent, mortgage, utilities, etc. – for one or two years. This often means the difference between a business surviving or closing until the owner can get back on his or her feet.
Individual Life Insurance
What if you or one of the owners were to die? What would happen to your business? You might assume that your family or remaining owners could sell or liquidate the business to ensure their financial security. Unfortunately, this doesn’t usually work. First, who wants to think about selling a business while grieving for the loss of a loved one? Second, when the family is forced to sell the business quickly, they may have to sell at a discount or during market conditions that make the business less attractive. In other cases, the business may be worth very little without the proprietor or partner. Individual life insurance can protect your family by providing funds to cover debts, ongoing living expenses and future plans, in the event that something happens to you. Life insurance can also be structured to fund a buy-sell agreement.
Key Person Insurance
This is another essential component of a smart business continuation plan. Key person insurance is life or disability insurance purchased by the business on an employee/owner that is essential to the running of the business. It is payable to the business. When a key person dies or becomes disabled, insurance can help make up for lost sales or earnings or cover the cost of finding or training a replacement.
Need Help Finding the Right Business Insurance?
Don’t take chances. It’s your responsibility for protecting your family, employees, and your business. Make sure that you plan for the unexpected with the right business insurance and individual life insurance.
Contact us at (800) 947-1270 or (610) 775-3848; we can help you determine the right insurance to protect your assets. As independent insurance agents, we'll shop among competing insurance providers to find you the right insurance at the best price. Call or click today.