Life Insurance For Small Business
If you own a small business, it makes sense to have life insurance for your employees. You don’t want to lose your key employees because it can be extremely difficult to replace them. But if you don’t have the time to educate yourself about small business life insurance, it can help you make the right decision. Whether you want to purchase term or whole life insurance, an insurance agent can help you make the right choice for your business.
While purchasing individual life insurance policies is relatively inexpensive, a group policy will likely be cheaper. However, group coverage is rarely equivalent to whole life insurance, which builds cash value. A good way to keep costs down is to offer group life insurance as part of a benefit package. If the company covers the cost completely, employees will automatically be covered. Alternatively, if the employees pay a portion of the cost, they can choose to pay a portion of the cost themselves.
When choosing life insurance for your small business, it is important to consider both your personal and business-owned policies. While life insurance for your business is not a replacement for a personal policy, it can provide financial security for your family and employees. A business-owned policy may also provide a tax-free lump sum payment in the event of death. It may even serve as a collateral for a business loan. This is an especially good choice if your business has employees or partners Company Life Insurance.
A combination of term and whole life insurance is a good solution for many small business owners. If you plan on retiring at a certain age, you may want to consider purchasing a policy that will allow you to retire when you want to, or you may prefer to remain active in the business into your 70s or 80s. In any case, you’ll need to plan ahead. However, there are several types of life insurance policies available for small businesses, and you should understand their differences before purchasing one.
Key person life insurance protects the company if a key employee dies or becomes disabled. A key person serves a critical role in the company and may be the best seller or the most trusted created mind. Their death or disability can lead to a significant loss for the business, and it can be a costly and time-consuming process to replace them. A key person insurance policy is the best way to ensure the continuation of your business, both financially and emotionally.
Group life insurance is also a good option for employees. It is an effective financial safety net for employees, and many companies offer group life insurance as part of their standard benefits package. The employee benefits from group life insurance include no medical questions and no additional premiums. Small businesses can also choose a group plan that allows employees to buy additional coverage for their families. In fact, 98% of employees participate in an employer-sponsored group plan.