July 1, 2012

Cover Story

People’s Choice

Social media has revolutionized the way companies communicate and interact...Read More

Featured Articles

Around Utah



Tori Baker: Leading Lady of Salt Lake’s Art House Theater

Mark Meadows: Enjoying the Journey

Legal Briefs
Business as Usual—For Now

Money Talk
Funding Your Dream

Economic Insight
Summer Reading

Lessons Learned
Emergency Back-Up

Get Found

Know Your Options

Business Trends
Forging a Career

Living Well
The Need for Speed

Utah’s Alcohol Problem

Ernst & Young Entrepreneur Of The Year

Capital Gains

Editor's Note
Utah’s Tech Industry is Booming

Special Section
Meeting & Event Planning Guide

Industry Outlook
Technology Industry Outlook


Know Your Options

The Right Insurance Can Help a Company Outlast Its Founders

Josh McFadden

July 1, 2012

Selecting the right insurance options for your company is all about the “what ifs?” What if the founder dies or becomes severely disabled? What if your financial wizard becomes critically ill?

Companies should plan for these types of contingencies from day one, says Blaine Allen, vice president of employee benefits at The Buckner Company.

“I recommend you remove any variables,” he says. “If you’re starting out, you’re going to have some document telling what will happen in the event of death or disability. It will be a legal document explaining what will happen in these instances.”

Whatever the economic conditions a company finds itself in, Allen advises business leaders not delay and insure themselves, their partner or partners, and their key employees. Even for startups, though it may be difficult, having the right insurance is vitally important.

“The structure of the insurance is different depending on the type of business—corporation, limited liability company, limited partnership, he says. “With a startup, cash flow is an issue. You have to qualify. A con can be the cost. But if you can get a hold of a good, qualified broker who can get a quote, you can make it work.”

The following are common insurance options that can keep your company humming along—even when the worst happens.

Life Insurance
You often hear about the importance of life insurance for individuals as a way to replace income for surviving family members in case of death. But business owners should be aware of how it can affect key leaders and other members of their companies.

Life insurance is critical whether the business is a sole proprietorship or a partnership. In a sole proprietorship, for example, the owner is personally liable for all debts in the business.

“Life insurance maintains and keeps the relationship viable,” says Allen. “It affects the ability to continue the business, and the ability to borrow money could be compromised if there’s a death with a key person.”

Life insurance comes in whole, term or universal forms. Allen is a proponent of term, which he says is inexpensive and allows the insured to lock in the term and receive a death benefit.

Partnership Insurance
In the case of a partnership, buy-sell agreements are valuable forms of insurance. Also known as partnership insurance, this allows a business owner to purchase shares of stock and continue running the business in the event of the death of his or her business partner. This agreement is funded with life insurance

Critical Illness Insurance
With this type of insurance, a policy holder is given a lump-sum payout if he or she is diagnosed with a critical illness outlined in the policy. Examples of frequently covered critical illnesses include Alzheimer’s disease, Parkinson’s syndrome and multiple sclerosis.

Key Person Insurance
Key person insurance protects a business when a key person dies. This insurance gives cash to keep the business running when this untimely event occurs. Disability insurance is also common. This allows a person to continue collecting income after injury or illness prevents that person from working.

“Cash solves 80 percent of all problems in a business,” Allen says.

Utah Business Social
UB Events View All
Utah Employers Healthcare Summit and Healthcare Heroes Utah Business Event
Oct 6, 2015
The Utah Employers Healthcare Summit is a gathering of all of the major employers, healthcare pro...
Twenty in Their 20sUtah Business Event
Nov 5, 2015
Meet the young and ambitious professionals who are taking the business world by storm! The honore...
Sustainable Business Awards Utah Business Event
Nov 19, 2015
Utah Business magazine is pleased to announce the Utah Sustainable Business Awards. This program ...
Community Events View All
9th Annual CHINA Town Hall: Chinese Investment in the United States
Oct 5, 2015
CHINA Town Hall is a national day of programming on China involving 70 cities throughout the Unit...
Oct 6, 2015
Link to tickets: https://www.eventbrite.com/e/secrets-to-financing-your-business-tickets-18611033...

info@utahbusiness.com  |  90 South 400 West, Ste 650 Salt Lake City, Utah 84101   |  (801) 568-0114

Advertise with Utah Business

Submit an Event

* indicates required information
* Event Name:
Price (general):
Website (if applicable):
Coordinator's Name:
Coordinator's Email:
Coordinator's Phone:
Venue Name:
Venue Address:
Venue City:
Venue Zip:
Event Capacity:
* Event Description: