Jan 25
Life Insurance For Your Business
Life insurance may be the last thing on your mind when you’re ticking off the long list of different insurance coverage you will need to cover your small business. It’s a personal thing, right?
Not necessarily. Some banks require that businesses requesting a loan must first take out a life insurance policy on the business owner before they will cut a check. More often than not, this manifests in the form of a term-life policy that is bought annually for an amount that will cover the loan and names the bank as the beneficiary.
Though a little morbid, term-life insurance isn’t that expensive compared to permanent insurance although you’ll notice that the prices tend to rise each year that you re-purchase the policy. Permanent insurance is a better choice than term insurance once you’ve got your business on your feet as the premium payments build equity. The benefits of this policy should be the families of those who own the business. Without it, the creditors of the business could come knocking at the deceased spouse’s door demanding payment. Insurance will offset that issue.
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