Business owners are a unique breed. Driven, inspired, positive and brave. Characteristics which often lead them to be more worried about the health and well being of their business as compared to their own personal situation. Recognizing that even a short period of disability can be disastrous to the business, disability carriers created a unique product engineered to help keep the business solvent while the business owner recovers from their illness or injury. 

Business Overhead Insurance (BOE)

Intent:

When a disability strikes a small business owner, not only are the owner's personal finances in jeopardy, but the very survival of the business may be at stake. BOE coverage is designed to reimburse the small business owner for most, if not all, of the identifiable monthly expenses of the business. The product is meant for those businesses which are dependent upon the working ability of the owner to generate the majority of company revenue, so larger organizations with a number of revenue generating employees may not be eligible.

Eligible expenses for coverage include:

• Salaries, fees, wages, benefit payments and employment taxes for employees
• Rent and lease payments for furniture, equipment and premises
• Utility costs including phone, electricity, heat and water
• Laundry, janitorial and maintenance service costs
• Property, liability, malpractice and business insurance premiums
• Professional, trade and association dues
• Business property taxes
• The greater of depreciation or principal payments on business loans on business property
• Interest on business debt existing on the day disability begins
• Legal, accounting and similar business fees

A policy may also cover:

• Salary of a replacement worker hired to perform the business owner's duties
• Reimbursement of monthly business loan obligations

Policy characteristics:

• Waiting Periods typically 30, 60 or 90 days
• Benefit Periods ranging from 12 to 30 months 
• "Roll over" unused benefits from one month to the next, allowing for the fluctuation typical in expenses from month to month
• Premiums are tax-deductable

Reimburses business owner for most of the fixed monthly expenses of the business while disabled.

Allows the business owner to focus on recovering from a disabling event, without worrying about how business needs will be met.

A business owner's disability not only affects the business owner and his family, but the employees and their families as well. The payment of employees' salaries is often one of the most appreciated benefits of a BOE policy.

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