Why Is Small Business Life Insurance Essential?
Small Business Life Insurance is used to protect a business, or the family of a businessman, from the financial loss
Small business owners depend on their enterprise as a primary source of family income and security, an investment vehicle, and major asset in their personal estate. If a key individual dies and the business fails, financial hardships can follow unless certain timely steps are taken. Business Life Insurance proceeds can be used to fund legal agreements designed to fit your business needs when a key person dies. Business Life Insurance is used to protect a business, or the family of a businessman, from the financial loss resulting from the death of someone associated with the business. Billions of dollars worth of this protection is now in force, giving assurance of business continuity, and protecting the owners or shareholders equity, There is no basic difference between business life and policies used for personal and family needs. But the protection set up by business firms involves many more complex details to meet legal financial, tax and technical problems. It is life insurance custom-tailored to the individual business. Like a personal fingerprint, no two Business Life Insurance plans are precisely alike in all details.Specific purposes for business life insurance:
- Key-man protection to reimburse for loss or provide replacement in the event of the death of a key employee.
- Partnership insurance, to retire a partner’s interest at death.
- Corporation insurance, to retire a shareholder’s interest at death.
- Proprietorship insurance, to provide for maintenance of a business upon the death of a sole proprietor.
- Insurance to aid a firm’s credit status, covering the owner or key man during the period of a loan or the duration of a mortgage on property held.
- When the estate of a businessman consists almost entirely of his interest in a business, insurance on his life, payable to his family on his death, to provide with ready cash and to aid in liquidating his interest in the business.