There are many people relying on your income if you are a business owner. These people are your family, business partners and employees. You can’t disregard their needs and you need to take in consideration every aspect that might put them in a financial risk—this includes your death. Purchasing life insurance for business owners is a must because it ensures that everyone involved in your life will be protected if you are involved in an accident that leads to sudden death.
To help you better understand the important of life insurance for business owners, here are some of its functions.
Replace Your Income
Your income is important to everyone in your life especially our immediate family. In the event of your death, your family can use the money that you leave them to fund different types of expenses. Basic expenses include food, mortgage and your children’s education.
A term life insurance policy is great to cover your family’s finances for years. Depending on the number of your children, choose a term life policy that can hold them off long enough until they finish school.
Pay Off Business Debts
It’s normal for businesses to be in debt, it’s what keeps it going through tough times. A business owner knows that he can pay the amount with interest as long as the business keeps going. However, when you die, your business debts still go after your business and everyone involved in it. Don’t let your business be taken away from your loved ones just because you can’t pay off your debt.
Choose a life insurance policy that matches the exact amount and length of the loan that you took. There is also an option to buy multiple term life policies to cover specific loans.
Divide Your Inheritance Fairly
If you have children who are still young and did not have a chance to help you with the business before your death, you can still give them inheritance. By purchasing a permanent life insurance policy, you can rest assured that your children get the payout when you pass away. This inheritance includes your business and any of its subsidiaries.
Provides Funds for Buy-Sell Agreement
If your company has co-owners, you need a buy-sell agreement to keep things simple in the event of your death. It states what will happen to your share of the business when something happens to you—be it death or being disabled. A life insurance policy will provide money for business owners to buy a share of a partner when they pass away.
Your business is like one of your children that you love dearly. Protect it along with your family, partners and staff by getting a life insurance policy. At Covensure Brokerage, we take pride in making sure our clients are well-protected at prices they can afford. To learn more about how we can help you please contact our agency at (248) 572-1580 or Click Here to request a free quote.