Personal Vs. Business

Business Overhead Expense Insurance

Business overhead expense (BOE) insurance is designed to reimburse a business for overhead expenses in the event a business owner becomes disabled. This policy is different from personal disability insurance as it pays benefits for a shorter period of one to two years. These policies are reimbursement contracts, reimbursing the disabled professional for actual fixed business expenses incurred.

Employee Benefits

Succession Planning & Buy Sell Insurance

A succession plan for a business is necessary to allow for seamless transition of ownership when owners/partners retire or in the case of a disability or death. The succession plan is a strategic approach to managing the issues of a transition by mitigating the risks involved while maximizing company value.

Whether you decide to transfer the business to a family member or partner, or sell and gain the proceeds of your investment, the idea is to protect the value of the business and reduce possible disruptions to day-to-day operations.

  • Financial Planning: Understanding the tax implications of a transition is important for establishing a financial plan for the business. In addition to estate taxes, having a contingency plan in the case of a slowdown is crucial to sustaining business.
  • Alleviating Stress: Disruptions to day-to-day operations are inevitable and can take a toll on those involved in the business cycle, especially in the event of a death or disability of an owner/partner. Advanced planning can help alleviate the stress and potential loss/termination of business.
  • Communication: It is important to include all family members, business partners and key employees that will be taking over the business to provide counsel during the succession planning. By establishing clear roles, they will be better prepared to manage the business.
  • Options: Understanding what options are available can properly position the business to reach its intended objectives. Passing the family business through generations is a traditional way of transferring ownership and continuing its legacy. The option to sell to a partner, management team or third party can provide the current owners potential payoffs of their initial investment.
  • Managing the Plan:  With regular reviews, the succession plan will stay updated with changes to tax legislation and ownership additions.

Buy/Sell Agreement Funding: Life insurance is beneficial in the event of an owner/partner’s death or disability. This policy can provide remaining owners/partners tax-free death or disability benefits to purchase the insured owner’s share of the business, as stated in a Buy Sell Agreement.

Call Brown Financial at (403) 252-1752
for your complimentary insurance review today!