Home Business & Finance Small Business Owner Advice: Choosing Insurance

Small Business Owner Advice: Choosing Insurance

Owning your own business comes with a long list of perks. Creating your schedule, having the final say in decision making, and turning your passion into profit are all fantastic pros of being an entrepreneur.

While all those pros can have you feeling on top of the world, there are many struggles those who own a business must face that don’t apply to people working for a company or corporation. Paid time off, retirement plans, and life insurance for business owners are more complicated than options supplied by an employer.

Rather than being offered insurance plans, entrepreneurs must find their own coverage — and it’s not always as easy as it seems. Life insurance and health insurance are essential to have in case of emergencies or accidents. But they can be challenging to purchase individually compared to company plans.

Finding the best insurance options doesn’t have to be a nightmare for entrepreneurs, however. There are ways to ensure you are getting the right coverage to fit your needs without paying an arm and a leg to get them.

Why is insurance coverage essential?

Many people may be under the assumption insurance isn’t as important as everyone makes it seem. The chances of a horrible accident, major surgery, or untimely death are usually slim.

While it’s easy to think that way, the chance for these kinds of events does exist. You can’t predict the future, and you never know what could happen. Insurance helps create a cushion for you or your family in the event something were to happen.

Without health insurance, you could find yourself paying massive hospital bills out of pocket after an accident. Or, you may avoid going to the doctor or dentist for regular checkups because you don’t want to pay the cost of visiting. Skipping regular visits can potentially lead to more significant health problems down the road as warning signs could be missed.

Not having life insurance can leave your loved ones in a tough spot if something happens to you. Without coverage, your family may be left covering funeral costs, figuring out how to make up for lost income, and covering financial mistakes or debt you may have left behind.

Insurance coverage helps cover necessary costs so you or your family don’t find yourselves in debt. Rather than worrying about future possibilities, you can be prepared for them.

Check Insurance Options Online

It can be challenging to know if you’re getting everything you need out of the insurance you choose. On top of that, you may worry if the price you are paying is fair.

Looking at options online can help ease some worry before settling on insurance coverage. Some small business owners may qualify for a subsidy — a form of financial aid or support — to help with costs.

Healthcare.gov is an excellent online resource for entrepreneurs who qualify for a subsidy and even those who don’t. However, this option will likely work better for those who are eligible. The site helps you shop and enroll in health insurance, making it easy and convenient.

If you don’t qualify for a subsidy, looking online is still an excellent way to explore and compare coverage options. There are many other sites to help compare cost and coverage options so you can ensure you’re getting the best price without sacrificing your insurance needs.

Determine Your Insurance Needs Ahead of Time

Insurance comes with a lot of coverage options. It’s essential to determine the things you can’t sacrifice before looking into your choices.

For example, if you have a family, it is likely essential for you to find a plan that covers dependents and yourself. However, if you are single, you may not be concerned with whether your provider offers a family plan.

Life insurance tends to offer a wider variety of options, so it’s important to consider what you’re looking for when shopping around. Each choice has its pros and cons, so make sure to consider all options before deciding what’s suitable for you.

And of course, as a business owner, you may also need to factor in the costs of more business-related insurance offerings such as fleet insurance and other commercial protection policies.

Term Life Insurance

Term life insurance is generally sold in lengths of one, five, 10, 15, 20, 25, or 30 years. Term life is typically a cheaper option than others and can work if you need coverage for a short amount of time. Your price for term life will reflect your age, health, and life expectancy.

It’s important to note that there will be no payout to your beneficiaries if you outlive the policy you choose. However, some insurance companies may allow you to turn term life into whole life.

Whole Life Insurance

Whole life insurance will last until your death if you keep up on your premium, which will remain the same throughout your lifetime. Your beneficiaries will receive a cash payout, and you also have the option to withdraw or borrow against your policy if you need to.

The downside to consider is that whole life insurance is typically more expensive than other policies. When checking your options, be sure you can afford the premiums before choosing this policy.

Universal Life Insurance

Universal life insurance offers a little more flexibility as you are able to adjust your premiums and death benefits. You will have life insurance until your death with this coverage option, so you won’t have to worry about losing benefits after a certain amount of time.

With this policy, it’s important to keep an eye on your premiums and fees. As you get older, your premiums may increase, so it’s essential to check on the price you are paying the older you get.

Insurance Options as a Small Business Owner

No matter what type of business you own — from creating your own skincare products to freelance writing — being an entrepreneur is an excellent accomplishment. However, it does come with particular struggles those employed by someone else don’t have to face.

Considering what kind of insurance coverage you should purchase as a small business owner can be a daunting task. It can be difficult to know what policy you should choose as an entrepreneur with so many options available. Luckily, there are many helpful tools to help you narrow down your search and find the insurance coverage that works for you.

Searching the web, utilizing government resources, and determining what is important can help you find the perfect policy to meet your needs. While insurance shopping may be scary, these tips can help you find the best coverage for you.

Alexandra Arcand writes and researches for the life insurance comparison site, LifeInsurancePost.com. She is a third-generation member of the small business community and hopes to share her insurance knowledge with other entrepreneurs.