Consider Disability Insurance for Key Employees

Disability insurance for key employees unfortunately doesn’t get the priority it should with busy business owners. A low priority is unwarranted in light of the fact that one in seven people will become disabled for five years or more before reaching the age of 65. The loss of a business partner or key employee could be financially devastating to a small company. We recommend that 2008 be the year that your firm examines this important business insurance coverage. In reviewing the potential provisions to include in a disability insurance policy, here are some key ones:

• THE DEFINITION OF DISABILITY. A policy can define disability as applied to your specific occupation or to any occupation.
• SHOULD A COST OF LIVING ADJUSTMENT (COLA) PROVISION BE ADDED? A cost of living adjustment option will help your plan stay current with rising inflation.
• HOW MUCH COVERAGE DO YOU NEED? The answer to this question is often a mixture of both how much you need and how much the firm can afford.
• GUARANTEED INSURABILITY. This is not a policy provision to take lightly. If you decide to add more insurance in the future, the guaranteed insurability option is a smart choice.
• NON-CANCELABLE POLICY. This is a great option but it does cost more.
• CARRIER FINANCIAL RATINGS. Pick an insurance carrier with solid financial ratings. In these turbulent times, a highly rated insurance carrier is a must.
• BUSINESS OVERHEAD PROVISIONS. A business overhead expense plan can be a smart addition to a basic policy that not only provides income to the disabled insured, but also generates income to the business to pay overhead expenses such as payroll, and rent. This option can keep the business running while the key employee recovers from a disability.

By working with our sales staff, we can bring clarity to the perceived complexity in this important business insurance coverage. Call us today for a free review of your firm’s life and disability insurance needs.