How much life insurance coverage should a business owner carry? It all depends on your unique circumstances and financial goals. Generally speaking, term life insurance offers the greatest coverage for the lowest premium payments so it provides an affordable solution. Permanent life insurance is an option if you anticipate a need for lifelong protection and prefer the option of accumulating tax-deferred cash value insurance.Under the umbrella of permanent insurance are four main types: whole life, universal life, variable life and variable universal life. All are more expensive than term life insurance but can provide the investment option some business owners are seeking. Term life insurance does not build up value, it strictly provides a death benefit and that is why it costs less.
Business partners often design a buy/sell agreement. In this arrangement, you and your partner will own policies covering each other’s lives. If the first business partner passes away, the other receives a death benefit that can be used to buy the remaining half of the business. Financial planners are the best people to advise you in this area.
Like any business transaction you make, you should feel comfortable with the insurance company you choose to essentially protect your business interests for the next couple of decades. Before making a purchase of any term life policy make sure to research the ratings of the life insurance company. You want to be sure that company has the financial strength and a solid reputation.
Read more about:
- Life insurance and your business
- Why business owners need life insurance
- Choosing the right insurance company
At LifeQuote, we are more than insurance experts – we take the time to learn about you, your family and your preferences in helping you consider a life insurance policy.
We offer several features to help make the process of finding the right life insurance as simple and painless as possible. Our easy-to-use calculator helps you to better identify your insurance needs.
To compare quotes, simply click get a quote and you will be taken to a page that asks you to complete a form. If you’re unsure of how much coverage you need, or how long the term should be, connect with one of our knowledgeable representatives immediately. You can send us an email or call our licensed agents at 1-800-521-7873.