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Business Owners, Are You Over-Insured?

Are you carrying the right amount of insurance for your business and personal needs? Unfortunately, far too many entrepreneurs spend too much on policies and multiple forms of coverage, assuming the more is better. More is neither better nor wise, as it’s simply wasteful. What should you do if you discover that you have too much insurance? Step one is to figure out how to know where you stand. There are things to check that can impact the aftermath of your decision to cancel your policy. Then, if you need to terminate a policy or two, make sure you follow the proper legal procedure for doing so. 

Making an honest assessment of the situation will give you a clear view of what needs to be done. Consider selling personal life policies that you bought without much forethought. Then, do yearly coverage checkups with a licensed agent. Be careful not to end a business insurance contract, like liability protection for your office, on a whim. Move carefully, and be thorough. Here’s how to begin.

Assess the Situation

Even owners of small companies can find themselves with a half-dozen or more policies in place at the same time. Some of those contracts are useful, but some are not. The essential first step is to sit down with your accountant or lawyer and decide which business coverage contracts are unneeded. If you want to get cash out of a personal life policy, keep in mind that you can use the proceeds to cover business expenses if you wish. There’s no restriction on how you spend the money you get from a life settlement.

Sell Your Life Insurance Policy

Most business owners carry personal life insurance. The problem is that these policies can quickly outlive their usefulness. That’s particularly true if you purchased coverage many years ago when your financial needs were strikingly different from what they are now. A life settlement is the best way for seniors who want to access the monetary value of an outdated or unwanted policy. Many are often surprised to learn that an unneeded life insurance policy can be converted to cash quickly and simply. Of course, it’s crucial to work with a reputable agency in order to get the most out of the deal. The process is convenient and includes minimal paperwork or time when done right.

Do Annual Coverage Check-Ups

It’s always a good idea to consult with a pro before deciding about business insurance. At least once per year, meet with your agent and do a full-scale review of all your company’s insurance needs. Expect to need more or less protection as your company grows, you sell major assets, take on employees, move into a home office, and other changes. Just the same as you can find ways to save on car insurance, the same idea can be applied to business insurance as well, there are savings to be had if you take the time to find them. 

Try to match your organization’s current needs with the right kind of protection. It’s helpful to find a local agent specializing in assisting owners with their changing insurance needs. Never void a policy on your own without personally consulting with an agent, and always know whether you’ll need a new policy to replace the old one. This is particularly relevant for organizations that are growing quickly and taking on paid workers.

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