All small business owners need to make sure they carry enough insurance to help protect their families, employees, and assets. With the right strategic plan in place, the small business owner can help protect his or her business against financial loss due to illness, disability, death, and other calamities. There are many different types of insurance small business owners need to consider.
To help protect your overall business investment, the purchase of small business insurance should be considered. This type of insurance can help protect you and your company in the following unforeseeable situations:
- A competing business sues your company for infringement.
- One of your clients sues you over a breach in contract.
- A customer falls and gets hurt while on the premises of your store or business.
- One of your employees gets injured while working.
Do your homework before purchasing business insurance. Shop around. Remember that sometimes you get what you pay for – the least expensive policy may not always be the one you want. There are many kinds of business insurance including general liability, workers’ compensation, commercial auto, and umbrella. Be sure to get the one that makes sense for you and your company. Find out the deductible and exactly what is covered under the policy you choose.
Life and Disability Insurance
It is recommended that you purchase adequate life and disability insurance coverage on the business owner. Often individuals take out personal loans to start or grow their business. In case of untimely death or a disabling accident, it is crucial that all assets are covered. The loss of the business owner can have a significant effect on the value of the business. Obtaining an individual life insurance policy can help protect the family in this situation, providing funds to cover debts, ongoing living expenses, and future plans.
Many small business owners also provide life insurance plans for their employees. Benefit packages can be costly and employers will often decide to offer modest packages to the majority of their workers, while rewarding top executives with bonus plans. Under this arrangement, top employees can buy cash rich insurance policies and name themselves as owners. The employer pays the premiums, which are often fully tax deductible, directly to the insurance company. There are also supplemental executive retirement plans that can be offered to star employees.
As important as it is for the owner of a small business to have sufficient health insurance, it is also a good idea to offer health insurance to employees. Often people consider employee benefits a priority when deciding whether or not to accept a job. Benefits may include health, dental, and vision, as well as voluntary options that enable employees to purchase or increase benefits on their own.
Small business owners help themselves, their business, and their employees by offering retirement savings plans. Such plans often help attract (and keep) excellent employees, as well as providing tax advantages for the business. A retirement plan also helps the small business owner secure his or her own retirement.
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