Employee Benefits Planning
Business Continuation Planning (Succession Planning)
Succession planning is the process of protecting the longevity of your business. It’s about preparing for the unexpected and helping to ensure that your business will continue in the manner in which you choose.
How is life insurance used?
Life insurance is often used to fund a buy-sell agreement, one of the most popular business succession planning strategies. A buy-sell agreement involves one party buying a deceased business owner’s interest in the business at a certain price, and another party, usually the deceased owner’s estate or heirs, selling the interest at that price. By entering into a buy-sell agreement, you can help ensure a smooth transition of ownership, with minimal disruption to the day-to-day activities of the business.
What are the benefits of life insurance?
The death benefit in a life insurance policy ensures that the surviving owners will have a source of liquidity to buy out a deceased owner’s share of the business. In some cases, you also have the flexibility to increase or decrease your coverage to keep pace with the value of your business.
Business Overhead Expense DI: A Must-Have for Small Business
Stop and think. How long could your business sustain itself if you were unable to work? For many small business owners, the answer is “not long.” That’s why BOE disability insurance is a must for anyone who owns a small business or whose business relies on a few revenue producers. In the event of an unexpected injury or illness, a BOE policy can be the difference between sustaining an operating business and sliding into bankruptcy.
- Your small business is the culmination of your hopes, dreams and countless hours of hard work. You may even aspire to pass your business on to future generations. Don’t let your dream deteriorate due to an unexpected disability. Be ready for anything with affordable BOE protection. Isn’t your dream worth protecting?
- A Business Overhead Expense (BOE) policy pays overhead expenses if an insured business owner or employee becomes disabled. The policy is typically short-term, from 12 to 24 months, and is designed to keep the business running until the insured recovers from a disability.
- BOE policies typically cover rent, interest payments on some types of debt, utilities, salaries, office equipment expenses and maintenance, both payroll and property taxes, professional membership dues and subscriptions, accounting fees and insurance premiums for employees. In some cases, BOE policies also cover the salary on any temps hired to do the job of the disabled person.
- BOE policies typically do not cover income taxes or the cost of inventory.
Disability Buy-Sell: A Backup Plan for Partnerships
- Stop and think. If your business partner becomes disabled and is unable to pull his or her weight, how will you feel in six months? How will you feel in two years? How will your partner feel in two years? This kind of situation easily results in awkward personal relationships and crippling financial strain. A far smarter alternative is to have a backup plan in place — before disability strikes.
- A disability buy-sell policy protects both partners while saving countless businesses and relationships. Do you understand how this coverage helps you prepare for all the what-ifs?
- Disability buy-sell insurance policies are for small businesses with partners or several owners. This policy is often coupled with an individual disability policy. It allows a company to remain operating if one of the owners becomes disabled.
- The disability buy-sell policy provides cash for another owner to purchase the disabled insured’s share of the business. This policy does not replace income, rather it protects the business. The benefits of this policy are twofold, the disabled owner receives his value of the business and the business remains intact and fiscally stable.
Key Person Disability Insurance: The Key to Sound Business Management
Stop and think. Do you employ anyone with capabilities that would be very difficult or nearly impossible to replace? How much business and profit would you lose if that person left? If you employ a veteran salesperson with established relationships; a highly-skilled individual with training that is unique to your business; or a business leader with a high level of responsibility and irreplaceable knowledge, take a closer look at key person DI. Someday, it might unlock the solution to keeping your business afloat.
Have you heard the old adage, “Don’t place too many eggs in one basket?” That’s what key person DI is all about. It keeps the eggs coming, even when you lose your best producing hen! Can you see how this coverage could help you survive a very stressful situation?
Key person disability insurance is coverage for the business. If a vital employee becomes disabled and is covered by a key person disability insurance policy, the business will receive disability income checks. The disability checks can then be used to cover the financial loss of the missing employee or it can pay for a temporary worker while the insured person recovers from the disability.
This insurance can be purchased for one or more people in a business. The policy will pay according to its terms until the disabled person can return to work or is permanently replaced. Key person insurance is a short-term coverage and most policies offer a benefit period of 12 to 24 months.
How hard are your “benefit dollars” working for you? Taking care of business is your everyday task! We know that you are busy. Let Robeson & Associates take employee benefits off your hands and take care of you. With an understanding that the needs of each business are unique, we thoroughly analyze the market to design a program that suits your business and your budget. We represent all major insurance carriers. You can rest assured knowing we will find the most competitive options available. The employee benefit products we offer are:
- Group medical, dental, vision
- Flexible spending accounts (FSA)
- Health savings accounts (HSA)
- Health reimbursement accounts (HRA)
- Group life insurance
- Group long term disability insurance
- Voluntary benefits
- Sec. 125 plans
Employers face penalties for not offering health coverage in 2014
(Note: This article pertains to companies with over 50 employees)
By Anthem Blue Cross
Selected by Jim Robeson, CLU, ChFC, CHRS
What is the “employer mandate”?
Health care reform requires employers with 50 or more full-time employees to offer minimum essential health coverage to their employees. If they don’t, they must pay a penalty (a nondeductible, extra tax). They also may have to pay a penalty if any of their employees get government aid to lower their health coverage costs. Employers with fewer than 50 employees will not have to pay a penalty for dropping coverage.
When must employers start offering coverage?
Employers have until their renewal date or start of their plan year in 2014. For instance, if an employer’s plan starts on January 1, that employer must offer health coverage January 1, 2014. But if an employer’s plan starts on July 1, that employer has until July 1, 2014, to offer health coverage. . . .