Business Owner Protection

What Is Business Owner Protection?

Business Owner Protection isn't one product — it's a set of strategies that work for any owner, whatever the business: a general contractor, a restaurant, a retail shop, a salon, a repair shop, a professional practice. It brings together four tools: owner-focused permanent life insurance (sometimes called owner IUL) that protects the owner's family and can build value over time; key-person coverage on the people the business can't run without; buy-sell funding that gives partners a ready way to handle an ownership transition; and worksite or voluntary benefits the team can enroll in.

Together, these tools answer the four questions every owner eventually faces: What happens to the business if something happens to me? What happens if we lose the one person we can't replace? How does my share of the business pass to my partners or my family? And how do I attract and keep good people?

Who Is It For?

• Business owners in any industry — contractors, restaurants, retail, services, and more
• Founders with business partners
• Owners whose business depends on one or two key people
• Owners planning for succession or an ownership transition
• Owners who want benefits that attract and keep good employees
• Family businesses preparing for the next generation

Who Does It Protect?

These strategies protect the whole business — not just one person — so the company, the family behind it, and the team that runs it aren't left exposed.

• •The business itself and its ability to keep operating
• •The owner's family
• •Key employees the business depends on
• •Business partners and co-owners
• •Employees, through worksite benefits

When Should Someone Get It?

• ✓When the business is established or growing
• ✓Before losing a key person the business depends on
• ✓When bringing on partners or co-owners
• ✓When planning succession or an ownership transition
• ✓When you want to attract and keep employees with benefits
• ✓While the owner and key people are healthy enough to qualify easily

Generally, it's easier to put these protections in place while the business is stable and the people involved are healthy.

Why Should Someone Get It?

How Are Benefits Received?

How benefits are paid depends on which strategy is in place and how it's structured:

1. 1

   A claim is filed with the insurance company

2. 2

   Required documentation is submitted

3. 3

   The insurance company reviews and approves the claim

4. 4

   Proceeds are paid to the party named in the policy — the business, the family, or the surviving owners

5. 5

   Worksite benefits for employees are paid per each enrolled policy

Depending on the structure, proceeds may:

• •Keep the business running through a transition
• •Fund the buy-out of an owner's share
• •Replace the value a key person brought to the business
• •Support the owner's family directly
• •Provide employees the benefits they enrolled in

How proceeds are treated for taxes depends on how each strategy is owned and structured — a licensed agent who specializes in business-owner planning can confirm the specifics for your situation.

Where Can Someone Get It?

• •A licensed agent who specializes in business-owner planning
• •An independent insurance agency
• •Financial professionals who work with business continuity and succession
• •Insurance companies offering life, key-person, and worksite benefit solutions

A licensed agent can help an owner compare options based on:

• Business structure
• Number of owners and partners
• Which people are key to operations
• Business debt and obligations
• Succession or continuity goals
• Size of the team

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