I get that business people get tired of hearing about all of the kinds of insurance they should be carrying because I am one. I carry more than what’s required by law in errors and omissions insurance just because of the litigious nature of our country. I err on the side of caution and especially on the side of my life insurance customers because, while I’ve never had a complaint against me, I am not what’s commonly called “deep pockets” in lawsuit lingo but if I screw up I don’t want my shallow pockets to be an issue.
I do carry adequate business life insurance (big surprise, huh?) because I’ve worked most of my adult life building a business and a block of customers that both rely heavily on me. I want my life insurance business to outlive me and continue to serve my customers and I want my wife to be able to live off of the legacy we’ve built. I would hate to think she’s put up with all of my moods while growing Hinerman Group into a nationally known impaired risk life insurance agency and not be left with an income stream from a business that has a good succession plan.
Businesses cease to exist every day when the owner or the key person in that businesses dies. Business life insurance can ensure the continued existence of the business which, in my case, I feel strongly about because I believe that what I do and what I’ve done for 15 years to help people get life insurance over the years when they truly felt like they wouldn’t be able to get any, is important. It helps people in need and changes the dynamics of their lives. It means, at least financially, that their families will be able to pick up the pieces and move on.
So as CEO or owner of a company, business life insurance is as important a consideration as we can make. It is just another insurance to the extent that what you’ve led or created was just another job. Businesses are our babies, or the babies of our partnerships or stockholders. They are the baby of key people in your company, those people whose employment in the company has helped to make the company the success it is. When our untimely death creates a nightmare for our partner due to our lack of a life insurance funded buy/sell agreement or when our cash flow and customer base take a hit because we haven’t planned for the untimely death of that one person who makes it all click with key person life insurance. Lack of planning with life insurance for the untimely death of a major or key stockholder in the company can create a scenario where too much stock is suddenly available and the company can’t afford to purchase it back. Consider for a minute what the outcome would be if someone else did have the cash and by being in the right place at the right time (with the money), they become majority owners of your company.
Bottom line. I want my life insurance business to outlive me. I want it continue to help businesses and families in the future get the life insurance coverage they need to take financial catastrophe out of the equation. Over these 15 years I’ve personally witnessed both good planning and no planning and its’ impact. Even if you feel comfortable with the future of your business without life insurance, make sure that is a decision that was carefully considered and not one made by hitting the default no planning button. Call or email me directly if you have questions or if your business life insurance is important but you feel like the price is too high because of an impairment. My name is Ed Hinerman. Let’s talk.