Question: What are some things I should consider when buying life insurance as a business owner?
Do You Have Enough?
"Make sure you purchase enough to allow the business to continue operating in the event of your passing. Also, make sure your family is protected from the loss of your income."
@moneycrashers
What Are the Tax Ramifications?
"Death and taxes and unavoidable. But before you buy life insurance you should talk with your tax accountant. Life is just going to get more expensive, you should prepare well for it."
@johnrampton
What Is the Insurance For?
"What is the insurance for? Estate planning? To buy or sell funding for a partnership? Tax advantaged savings? Business succession planning? Executive bonus/retention programs (a.k.a. golden handcuffs)? Not all life insurance is created equally. A specific design is required for each scenario listed, and the devil is in the details. Improper design can lead to disastrous results."
@MarkKrassner
Do You Need Key Man Insurance?
"Any business with leaders that are key to the organization's long-term success should have Key Man Insurance. This ensures that: first, there's insurance for the family of the individual; second, the company has a buffer to find someone else to replace them; and third, gives the opportunity for the company to buy all shares back from the dependents of the deceased."
@andrewhowlett
What Are Your Specific Needs?
"When considering life insurance or Key Man policies, make sure to do your homework. From different companies to varying policies, it is essential that you shop around and realize what policy works best for you from a logistics and accounting standpoint. Going with the best cost or easiest tax policy may not correlate to the exact need you need to fill, so make sure to do your homework!"
@kimkaupe
