Protect Your Business and Income with Disability Insurance – As a business owner, you likely have life insurance to secure your family’s financial future in the event of your passing. You may also protect your assets, like your home and car, with insurance. However, many business owners overlook insuring their most valuable asset—their ability to earn an income and manage their business.
Disability Insurance
Disability income insurance is not a luxury but a vital part of your financial safety net. It ensures you can maintain your family’s lifestyle and keep your business running if you are unable to work due to illness or injury. Without this protection, a prolonged disability could jeopardize both your personal and professional stability.
The amount of coverage you can purchase typically replaces 45% to 75% of your pre-disability income. The cost depends on factors such as your age, health, occupation, and the extent of coverage.
To maximize your benefits, look for policies with these essential features:
- Favorable “Total Disability” Definition: Opt for coverage that allows you to receive benefits if you can’t perform your specific occupation, even if you can work in another field.
- Non-Cancelable Clause: Ensure your premiums remain stable and your policy cannot be canceled up to a specified age.
- Proportionate Disability Payments: This feature provides partial benefits if you can work only part-time or lose income due to reduced job duties.
- Extended Benefit Periods: Policies offering benefits until age 65 or beyond can secure your income during later working years.
- Flexible Waiting Periods: Longer waiting periods lower premiums but require careful planning to bridge income gaps during that time.
Additional riders, like Social Security substitutes and future increase benefits, can further enhance your policy. Social Security substitutes provide supplemental income if you don’t qualify for government benefits, while future increase riders let you adjust coverage as your income grows.
Beyond personal disability coverage, business owners should also explore disability buy-out insurance and overhead expense policies. These options help safeguard your business’s operations and partnerships in case of unforeseen circumstances.
Now is the time to evaluate your disability income protection needs. Consult with us before talking to an insurance professional to design a policy that aligns with your financial goals and ensures your business and family are protected.
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