As a business owner, you want to consider how life insurance protects both your business and personal and business planning. It can even play an important role in the stability of your enterprise. Personal life insurance covers your business partners and your family by including benefits for each. In some cases, these policies are written so that your family gets a payout without having any further say in the business. This gives your partner the peace of mind that their interest in the business is protected in the event of your death or vice versa. Your Mid Atlantic Insurance Financial agent can answer detailed questions regarding eligibility and purchase terms for life insurance to protect your Laurel, MD business as well as your family.
Key Person Life Insurance
Key person life insurance is a type of insurance that protects the business. This is a way to cover losses resulting from the death of a key person that passes away unexpectedly. When this occurs, and no insurance is present, the company usually loses a lot of customers, who were used to dealing with the deceased party. In turn, revenue drops too quickly for the business to naturally recover.
This loss can be covered if the company has bought a life insurance policy on the deceased key employee (who can also be an owner or business partner). The proceeds of the insurance policy are given to the company to aid in the recovery of lost income. Some policies include a provision to hire, relocate and train a replacement.
Considerations When Purchasing Business Life Insurance
When you buy business protection insurance in the form of life insurance, be sure to obtain a permanent rather than a term policy. A term life insurance policy can expire, forcing the person insured to re-qualify later in life when it’s harder to do so.
Mid Atlantic Insurance Financial can help you plan out how to use life insurance to protect your business interests without jeopardizing the financial security of your survivors in Laurel, MD.