All About Business Protection Life Insurance: December 2009

Thursday, December 24, 2009

Update Dec. 24 - 2009 All About "Business Life Insurance" Information By Insurance Experts

It is important that people own a business understand what is business insurance, so they can protect their business in case of any unforeseen event happened causing hardship to the business owner and their family such as business store burned down one day, if you don't carry insurance, you would endured some hard times after that. You make sure you have insurance for anything importance, or anything that could prevent you from earning a living.

The Value of Insurance For Business Security

By Sarah Martin

Insurance is often undervalued, frequently because people have a narrow mind when it comes to the insurance business as a whole. However, insurance helps to give security to business dealings. Here is a look at how insurance can give your business security.

Insurance is a swap:

All types of insurance do one thing - they exchange a small, certain payment for a large, uncertain loss. Basically, this means that you pay a small fee and fixed intervals (your premium), and the insurance company will take the risk should any losses ever occur.

Take, for instance, a flood. Floods are often destroying business property and inventory, but it is impossible to know when one will, if ever occur. If you were able to tell when a flood would occur, you wouldn't need homeowner insurance. But because you can't, taking out a flood insurance policy can help you to replace the things that you lose when there is a flood.

Group statistics can be calculated:

While you cannot tell what your chances of a flood, fire, or other disaster will be, your business group as a whole has set statistics. For instance, if you own a bakery, your risk of having a fire destroy your business is higher than the risk of a fire taking down an office building. Knowing that, you could decide that as a bakery owner, your risk of having a fire is higher, and you therefore need more insurance. If you are an office owner, you could decide that your risks are lower and that you need less insurance. Every business and every individual needs certainty, and insurance can help to provide certainty in an uncertain world.

All insurances are similar:

Fire insurance is not terribly different from flood insurance, and flood insurance is not any different than life insurance. To a certain extent, all insurances are the same. If you work with life insurance, then you know that approximately 3.8% of people die before they are 25. This means that another 96.2% don't, but you have no way of knowing which of the two groups you will be in. All you can do is calculate your personal risk. The higher your risk, the higher your premium will be.

This is true of all types of insurance, including home owner's insurance. Property owners never know how good their title is. A merchant doesn't know how much he will lose on a given debtor. However, when you look at a large enough group, you can get an idea of what your individual risk is. Everything you do in business has a certain risk to it. On your own, you cannot determine what the risk is, but as a member of a business group, you know what the statistics are for that group.

What insurance does for your business:

Business has risk. There is the risk of losing property, losing life or health of employees, or losing money, among others. What insurance does is give you some guarantee against these losses. By knowing what your risk factor is, and insuring it appropriately, you will know that you have what you need sure an incident ever occur.

Sarah Martin is a freelance marketing writer based out of San Diego, CA. She specializes in business, finance, and insurance. For a free home owner's insurance quote, please visit http://cheap-insurance-rates.com/

Article Source: http://EzineArticles.com/?expert=Sarah_Martin

Life Insurance - Pick the Right Type For Yourself, Your Family, and Your Business

By Marilyn Katz

You purchase either permanent or term life insurance. Permanent life insurance will cover you for your whole life with premiums calculated to cover the cost of insurance until a very advanced age, typically 100. If you live past the advanced age the policy is calculated for, you will no longer need to pay premiums, and in some cases, may receive your death benefit as a birthday present! If you pay premiums for your whole life, then this is called whole life or straight life insurance.

Even though the premiums are calculated to provide you insurance over a long life, you may have a policy that can be paid off in a shorter times. Common pay off periods are ten or twenty years. In order to receive the full tax benefits of insurance, as in a tax free death benefit, the payoff period must be longer than seven years. If the payoff period is shorter, the policy is called a Modified Endowment Contract (MEC).

An example of a MEC is single payment whole life. These types of life insurance are still popular products, especially seniors who want to transfer wealth to their heirs. For instance, a twenty thousand dollar contribution may provide an immediate death benefit of thirty-five thousand dollars. In addition, these types of policies usually pay interest on the cash value, and they may even be indexed to equities like the stock market. Since they have an immediate cash value, money will grow right away. The longer the insured person lives, the greater the value of the policy. The death benefit will be taxable under current federal law, but the growth is tax deferred, and they provide an immediate death benefit.

Another type of permanent insurance is called Universal Life. Universal life insurance separates the cost of insurance from the cash value, and many products are indexed to security indexes like the S&P 500, allowing for greater returns. Most policies guarantee that the return will never be negative, and some provide a no-lapse guarantee. This means that as long as you pay an agreed upon minimum payment, the insurance company will not lapse your policy because the returns are not large enough to cover the cost of insurance.

On the upside, gains in the value of your insurance policy can increase your death benefit, increase the cash value, and generally provide you with ways to access the money in your policy while you a alive. As you may have guessed, Universal Life Insurance provides life insurance, as well as an investment or savings vehicle. You may assume more risk with Universal Life than with Whole Life, but can be rewarded with greater returns.

Of course the last type of insurance is term insurance. This is usually considered pure insurance because you are generally only paying the cost of insurance without ever receiving any cash value. That is why term life insurance has the lowest premium cost. The insurance company only accepts the risk of insuring your life for a specified period of time. They are betting you will live for a period of ten, twenty, or thirty years. You are purchasing term life insurance to make sure that your family or business will survive just in case you do not.

Of course, the life insurance world is not this simple. You can add a term rider to universal life insurance to provide extra protection during those years when you need more coverage, You may also add return of premium riders to term policies so you will get premiums refunded when the policy ends. Before you purchase a long term contract like life insurance, you should always consult with professionals and do your own homework.

M Katz has helped many families and businesses choose life insurance protection. The key is to analyze an individual's needs, educate the consumer, and then allow them to select a policy that will serve their needs. M Katz believes that insurance shopping works out best when it is a consumer directed process!

Let us help you find the cost of life insurance with our fast, safe, and free online quote forms!

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Article Source: http://EzineArticles.com/?expert=Marilyn_Katz

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Friday, December 4, 2009

Update Dec. 04 - 2009 All About "Business Life Insurance" Information By Insurance Experts

20 Year Term Life Insurance - So Many Uses For This Policy

By Donald Lusan

The 20 year term life insurance policy can be effectively used in oh so many situations. We will look at some of them but first let us define what this policy is all about. 20 year term insurance has a level death benefit for the entire 20 year period. This death benefit can be paid in one lump sum or in income form. The premiums, more often than not, are also level for the duration. Sometimes a life insurance carrier may elect to allow applicants to start the policy at a lower initial rate then increase it at a specific predetermined date in the future, for example, at the 5 year point or 10 year point. How could you effectively put a 20 year term life insurance policy to use?

If you are married and you have children the youngest of which, for example, is 5 years old this policy could cover all your immediate life coverage needs. This policy can determine that your present income will continue after your death. It could be used to provide planned sums of money that would be used to pay college costs for your children even if you are not around to share the event with them.

A portion of the proceeds of your 20 year term policy could provide funds to pay final expenses and burial costs.

If you are single and have no dependents this policy can be used to put you six feet under without any financial burden to your relatives. Why would you use this policy? The answer is simple. Although your need for life insurance is limited today, over the next 10 or 20 years you likely will have a need. As the price is so very low at the younger ages it may be wise to buy the policy now and when the time comes that you really need to own insurance you will already have it. You should also keep in mind that as you get older there is a possibility that you could develop some illness that may cause the company to charge you extra or to disqualify from obtaining a policy.

If you are single and have children your need will be much like a married person with dependents.

We tend more often than not to give much thought to the needs of the children in the event of the death of a parent. That is great but what of the needs of the surviving spouse. If the children are grown and on their own we still have each other. What if one of us should die. What of the surviving spouse. Is his or her income sufficient to live. Is the mortgage paid off or will the surviving spouse have to continue monthly payments. Think on these things. The 20 year term policy could provide cash or income for your surviving spouse which would be used to take care of these things.

Many business people find it a good decision to buy 20 year term life insurance. Business people tend to plan 1 year ahead, 5 years ahead, 10 years ahead and 20 years ahead. They may use life insurance to fund buy sell agreements if a partner or shareholder should die. They could buy out the shares from the heirs of the deceases partner or shareholder. Both surviving family and surviving shareholders should be pleased in this case. This policy is often used for key employee insurance. The death of a key person can devastate a business while they go about replacing this valued employee. The 20 year policy is a favorite for these business situations.

As you can see 20 Year Term Life Insurance is very often a good choice.

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and most admired life insurance companies in the United States as well as Canada. His advice is invaluable.

Donald's website is: http://www.lifeinsurancehub.net

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

Small Business Life Insurance Needs

By Donald Lusan

Have You Given Any Thought To Small Business Life Insurance?

What Type Of Business Do You Own?

Is your business a Sole Proprietorship?

Are you part of a business Partnership?

Is your business an S Corporation?

What about a C Corporation? Is this how you incorporated?

Have you taken advantage of the new Limited Liability Company laws?

How about Key Employees? Do you have any employees that you can categorize them as Key Employees?

Small business life insurance as it applies to each type of business is different in many ways but there are also many similar features as well. What we are discussing here is not group life insurance but more specifically life insurance as it applies to the owners of each business and life insurance for the key employees. Let us take a look at each type of business and how life insurance could go a long way in protecting the business itself as well as the heirs of a deceased business owner.

The Sole Proprietorship.

Because the owner of a sole proprietorship and the business itself is considered one and the same one may think that the need for small business life insurance is limited. Nothing could be further from the truth. We put in a lot of time and effort building a business that has to be dissolved at our death. We do want to have this business transferred to a member of the family when we die. How can this be done?

The estate of the sole proprietor can sell the assets of the business upon his or her death. A small business life insurance policy can be bought during the lifetime of the owner the proceeds of which would be used to buy the business. A buy sell agreement, which would be binding, would determine the terms and the amount to be paid for the business.

Let us assume the proprietor is married and has a son or daughter who is interested in taking over the business upon his death. This young person has spent a lot of time learning the intricacies of operating the business from his or her father. So dad decides he wants to transfer this business to this child upon his death. He has a buy sell agreement drawn up by an attorney that would fulfill his desires. This agreement is funded buy a small business life insurance policy specially bought for that purpose.

The proprietors wife is not particularly interested in the business but if the business owner dies before her she will still need income. The proprietor dies. The proceeds of the small business life insurance policy is used to purchase the business from the estate and the wife has full value in cash. She can use this money to purchase an annuity that would pay her an income for a certain number of years or for a lifetime. Of course this decision will depend on the amount of money we are talking about here.

The Partnership.

The use of small business life insurance in a partnership is very simple and straightforward. The ownership of this partnership is in the hands of three partners. For the sake of easy explanation let us assume that that these partners own equal shares. A buy sell agreement would be set up that would state that the partnership would buy the shares of a deceased partner from his heirs. The buy sell agreement would be binding. The heirs cannot decide they don't want to sell. The partnership would buy a small business life insurance policy on the lives of each of the partners in the amount of the value of their shares. The proceeds would be used to fund the purchase. In some cases the policies can be owned by the partners themselves. The results are the same.

The Corporations.

Small business life insurance for c corporations, s corporations are limited liability companies is very similar to that of the partnership. The corporation usually owns the policies on the lives of the principals. Upon the death of a stockholder the corporation buys the stock from the heirs of the deceased. A small business life insurance policy is the least expensive way to fund the buy sell agreement. It is recommended that the insurance is updated on a regular basis and that the buy sell agreement is reviewed and updated from time to time...as it is binding.

Key Employee Life Insurance.

What state would your business be in if a key employee died? Have you given this any thought? In my 40 years in the life insurance business I have seen many interesting situations. Some businesses had no key employee life insurance on their valuable employees...much to their detriment. Others were prepared and things continued on smoothly after the death of the key employee. It is recommended that if a business has a very valuable key employee that they buy a small business life insurance policy on the life of that employee equal to about 5 years of that employees income. Upon his or her beath the proceeds of the policy is paid to the business and used to help keep the business going while the company finds a capable replacement.

For more detail on Business Life Insurance go to: http://www.lifeinsurancehub.net

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and best life insurance companies in the United States as well as Canada. His advice is invaluable.

Donald's website is: http://www.lifeinsurancehub.net

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

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All About Business Protection Life Insurance

Thursday, December 24, 2009

Update Dec. 24 - 2009 All About "Business Life Insurance" Information By Insurance Experts

Friday, December 4, 2009

Update Dec. 04 - 2009 All About "Business Life Insurance" Information By Insurance Experts

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