• Fri. Apr 12th, 2024

Keeping the Lights On: Understanding Business Overhead Expense Insurance


Mar 9, 2024

Imagine this: you run a successful business, but an unexpected injury or illness takes you out of commission for a while. The bills keep coming in – rent, utilities, employee salaries. But without your usual income, how will you cover them?

This is where business overhead expense (BOE) insurance comes in. It’s a type of insurance designed to help businesses meet their ongoing expenses if a key person, like the owner or a critical employee, is unable to work due to disability.

What Does BOE Cover?

BOE policies typically cover a range of fixed business expenses, such as:

  • Rent or mortgage payments
  • Loan interest
  • Utilities
  • Salaries and benefits (excluding the owner’s salary)
  • Accounting and legal fees
  • Insurance premiums

How Does BOE Work?

If the insured person is disabled and unable to work, the BOE policy will typically pay out a monthly benefit for a set period, as defined in the policy.This helps the business stay afloat and cover essential costs while the key person recovers or a replacement is found.

Is BOE Right for Your Business?

BOE insurance can be a valuable tool for businesses that rely heavily on one or a few key people.It can provide peace of mind knowing that the business can continue operating even during a challenging time.

Here are some factors to consider when deciding if BOE is right for your business:

  • Business structure: BOE is most relevant for businesses where one or a few people are critical to daily operations https://www.walterretourenresistance.com/.
  • Financial stability: Consider how long your business could survive without its key person generating income.
  • Risk tolerance: If a disability would significantly impact your business, BOE can offer valuable protection.

The Bottom Line

Business overhead expense insurance can be a smart way to protect your business from the financial burden of a key person’s disability. By ensuring essential expenses are covered, BOE can help your business weather a storm and get back on track.

Remember: Consult with a qualified insurance professional to discuss your specific business needs and determine if BOE insurance is right for you.

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