Starting a business involves many responsibilities that may not be evident at first. Before you launch the company, you should have the right life insurance in Houston, TX. Here are important points to know about life insurance as a strategy to protect your small business after you die.
Why Entrepreneurs Need Life Insurance
If you have big thoughts and want to start a company that pays several employees, you definitely should consider a life insurance plan. It can keep your business dreams alive after you pass away. Not only does life insurance give you peace of mind, but the benefits can also grow over time.
Since you are the driving force behind your company and workers depend on you as an employer for income, you can make sure your company survives after your death with a life insurance plan. The plan can specify who the beneficiaries are and how much they receive upon your death.
Key Person Insurance
A key-person insurance policy pays benefits when a key owner or employee dies. The death benefit money is paid directly to the company that holds the policy. The proceeds can help a family member invest in a worthwhile career or hobby to further their interests.
In the event that a company has multiple owners, a buy/sell agreement benefit pays funds to surviving owners when an owner dies. They can use these funds to buy out the deceased partner’s interest.
Individual Life Insurance
If you are a sole proprietor, there are still good reasons to consider a life insurance policy. You may still want your family or friends to keep the business going after your death. Another option is to provide assets to beneficiaries as your business closes down or sells to another entity.
Disability Insurance Considerations for Entrepreneurs
Becoming disabled is unpredictable and can happen to any entrepreneur. Getting a disability insurance rider added to your life insurance policy means you can receive benefits to pay living costs if you become disabled.
Disability Insurance for Employees Vs. Entrepreneurs
Twenty-five percent of workers will become disabled during their career, according to the Social Security Administration. Due to the high odds of disability, it’s important for all workers to have some type of disability coverage.
· Disability Insurance for Employees
Many employers provide long-term disability coverage for their employees. This coverage pays up to about 66 percent of their normal paycheck if they are no longer able to work. Corporations have the option of providing short-term disability insurance to employees, which may prove to be consequential in the coming years.
· Disability Insurance for Entrepreneurs
Owners who work independently, such as freelancers or solopreneurs, must pay for all of their own disability insurance. There are still affordable plans available, but it may take time and effort to find them. That’s why many entrepreneurs turn to independent insurance agents who work with multiple providers. Find out what your options are, then go with the plan that best suits your needs.
Cover Your Finances with J Archer Insurance Group
With the right life insurance in Houston, TX, you can relax and feel confident that your family will be in a good financial state after your death. There are plenty of other reasons to consider a life insurance plan to benefit you, your family, or your business. Contact us today at J. Archer Insurance Group. We are ready to help you customize a plan for your special needs.