INSURANCE YOUR BUSINESS NEEDS TO BE PROTECTED

INSURANCE YOUR BUSINESS NEEDS TO BE PROTECTED

 

As a businessman, you have exposed yourself to some risks the day you start your own business. A business is normally at risk, even before you hire your first employee, thus having the right insurance is very important. There are wide selection of insurance types for businesses to access in order to protect them from dangers like a lawsuit or a catastrophic event. Here are some types of insurances that an entrepreneur should consider for his business.

 

Property Insurance

 

Whether you own or lease your space, it is a must to take a proper business insurance. This type of insurance will cover your signage, equipment, furniture and inventory in case of a theft, storm or fire. But there are things that are generally not covered like flood, earthquakes or any kind of mass destruction under the standard property insurance policies. Make sure to check with your provider if your location is prone to these kinds of situations to price a separate policy.

Professional Liability Insurance

 

A professional liability insurance is also known as an E&O or errors and omissions insurance. It will cover your business against any negligence claims due to harm that may result from a failure to perform or a mistake. There is no one-size-fits-all policy for professional liability insurance. Every industry has its own set of concerns that will be addressed in a customized policy written for a business.

 

Product Liability Insurance

 

If you have a business that manufactures products for sale on the general market, it is a must for you to get a product liability insurance. You can take all the necessary precautions in making sure your products are safe but there are times when you can find yourself in a lawsuit due to damages or harm caused by one of your products. This type of insurance will work to protect your business in such case, with coverage available to specifically suit a specific type of product.

Vehicle Insurance

 

If there is a company vehicle being used, it needs to be fully insure as well to protect your business against any liability if an accident is to happen. You can at least get a third-party liability insurance, however, a comprehensive insurance will cover a vehicle in case of an accident as well. If your employees are using their own vehicles for business, then their own personal insurance will cover them in case of an accident. There is a major exception for this though and that is if they are delivering services or goods for free. This will also include delivery personnel.

 

Workers’ Compensation Insurance

 

A workers’ compensation should be added to your business’ insurance policy once you have hired your first employee. This will cover disability, medical and death benefits if in case your employee is injured or dies as a result of his work with your business. Even if your employees are performing a seemingly low-risk job, medical conditions like carpal tunnel syndrome of slip and fall can result in a very costly claim.

REASONS WHY PEOPLE SHOULD CONSIDER BUYING LIFE INSURANCE

REASONS WHY PEOPLE SHOULD CONSIDER BUYING LIFE INSURANCE

 

For a lot of people, they acquire their life insurance from a friend or acquaintance selling it to them and not buying it. There are many reasons why people should consider buying a life insurance. It is a fundamental and indispensable to a sound financial plan. It will give you a peace of mind knowing that money would be available to protect your estate and family in numerous ways.

 

Here are reasons to buy a life insurance.

 

  1. It will pay final expenses.

A funeral and burial cost can easily run up to tens of thousands of dollars and you don’t want your partner, children or parents to financially suffer in addition to the emotionally stress they are experiencing because of your death.

  1. It will cover your children’s expenses.

Like most parent, you want to make sure that your kids are well taken care off and will be able to afford a quality college education. For this reason alone, an additional coverage is very important while your kids are still at home.

 

  1. It can replace your spouse’s income.

If your spouse had passed away while your kids are still young, you would need to replace her income, which is vital to your lifestyle. You would also need to hire a help for domestic tasks you shared such as cleaning the house, cooking, laundry, carting kids to a visit to the doctor and helping with schoolwork.

 

  1. It will help pay off debts.

In addition to providing you with income to cover your day to day living expenses, your family would need insurance to cover any debts you have such as mortgage so that they will not have to sell your home to stay solvent.

  1. To buy your business partner’s shares if you own a business.

If you’re involved in a business partnership, you will need an insurance for your partner’s life. The reason for this is, if in case he dies, you will have enough cast to purchase his interest from this heirs and pay his share of your company’s obligations without having to sell the company itself.

 

  1. To pay off estate taxes.

Estate taxes can be really steep, so getting an insurance in place to pay them is vital to avoid jeopardizing your fund or assets for your retirement. This use of insurance for this purpose is actually common in big estates and uses permanent insurance rather than term insurance to guarantee that the coverage will remain until the end of life.

The face amount of an insurance policy should be high enough to substitute the after-tax income you would have made had you lived a full life, presuming you can pay for the annual premiums for that amount. In other words, the insurance substitutes the income you did not have the chance to earn by living and working until retirement due to an untimely death.

 

The right amount of insurance lets your family to continue their lifestyle, even though your income is no longer existing. The definite amount that you should buy will depend upon your present and likely future incomes, any special circumstances affecting you or your family, and your current budget for premiums.

WHAT YOU NEED TO CONSIDER FOR A LIFE INSURANCE IF YOU OWN A BUSINESS

WHAT YOU NEED TO CONSIDER FOR A LIFE INSURANCE IF YOU OWN A BUSINESS

 

Salesmen of insurance will typically say that if there are people counting on you, you need to get yourself a life insurance. When it comes to choosing coverage though, the needs of entrepreneurs can be different that other individual’s. If you will prematurely die, a personal life insurance can replace your income therefore protecting your family. In the event an owner, partner or key employee dies, life insurance could also safeguard the business can continue. Here some things you need to consider when you’re on the market of buying a life insurance as an owner of a business.

 

Term Life Insurance

 

This insurance is a simple option. You can choose a death benefit, which is the amount of money your heirs would be paid for when you die, and a term of how long you want that coverage to stay in place.

Term life insurance is what you can also get if your need is temporary like covering a mortgage balance or college costs. It is also a great option for any business with partners who may be retiring at a certain date in the future. The downside of this however is that it is only good for a specific length of time. You could be without coverage if you and your partner plan to be in business forever. You may want to consider a permanent policy instead.

 

Permanent Life Insurance

 

This policy offer both insurance and investment component usually called cash value. A portion of your premium will pay for the insurance element of your policy while another portion will go to the investment part of it, unlike term insurance which is insurance only. Once you are done paying term insurance premiums, you will get nothing when the term is over. On the other hand, permanent life insurance policies will always have the investment part even if your policy lapse.

The cost of this type of insurance is more expensive than term insurance, but as long as you keep on paying the premium, the policy stays in force for your lifetime.

 

Things to consider

 

  1. Your family. Life insurance will protect your family of any loss of income or to maintain a certain level of lifestyle in the event of your untimely death.
  2. Your business. Insurance is a must for business owners for income replacement and to protect the future of their businesses. If an owner, partner or even a key employee is suddenly gone, a business can deteriorate very fast. If you have the right insurance in place, your partners will have enough capital to keep the business afloat.

 

How much and where to buy

 

The amount of insurance your business or family needs will depend on your expected income over your lifetime, future expenses and debts as well as the general structure of your business. Before starting to shop for any insurance, make sure to go with a top rated insurance provider no matter what type of policy you will buy. This is to ensure that you’re buying from a company that will be around for decades to come.