Has Mr Murphy of Murphy’s Law invaded your business plans that involve a need for life insurance. I’m not pessimist enough to believe that “if things can go wrong, they will” but I know what a mess it can make when you are presented with a need for business life insurance and you run into unexpected problems when you apply for it. Without exaggerating almost all of these situations, whether they are due to a last minute decline or a product that doesn’t fit the business life insurance need, are caused, not by the proposed insured businessman, but by agents who are under educated in business life insurance and the banks and SBA that require it and under equipped in that they don’t have an option to fall back on if things don’t go well.
It isn’t uncommon for the CEO, partner or executive of a company to be reminded about an earlier failure to get personal life insurance, possibly due to something like being HIV+, when suddenly life insurance is required as collateral for a business loan or for a buy/sell agreement. Sometimes young CEO’s have never applied for life insurance or perhaps when they ran into problems before, when the need for life insurance was a want to and not a have to, so they just let it slide.
But now, starting a business or taking out a loan to expand a business or having finally come to end of the wrestling match with your accountant you agree it’s time to buy life insurance to fund a partnership business buy/sell agreement. This time though the need for business life insurance is a “have to” and not being able to obtain it cold be a deal breaker, an investment loss, or one of those awkward partnership moments where you can’t keep your end of the deal. The “have to” may come from your partner who, absent a funded buy/sell agreement has a family at risk of losing a life time worth of work. It may come from a bank or the SBA who require business life insurance. It’s a “have to”.
Bottom line. Don’t dawdle when it comes to business life insurance requirements. Start working on it as soon as the need becomes apparent. Knowing the final amount that you will need isn’t nearly as important as getting the ball rolling. Find an agent that is well versed in how to make business life insurance happen in a timely manner. Find an agent that can deal with your less than perfect health. Find an agent that can work with the bank on your behalf. Find an agent who absolutely has a back up plan if something unexpected happens. If you have a business life insurance need that will be coming up in the future and need to know how to get it done right or if you are in the midst of a business life insurance train wreck, email or call me directly. My name is Ed Hinerman. Let’s talk.