Disability Insurance Needs of the Small Business

Purchasing disability insurance is a choice that small business owners should seriously consider. Many business owners do not take the time to think about whether they should purchase disability insurance until it is too late. Here are a few things to consider about disability insurance needs for a small business owner.

Why Disability Insurance

If you are a small business owner, there is a probability that you will become at least temporarily disabled at some point. If you think that the government will step in and help you at that point, you may be sorely mistaken. It can be very difficult to qualify for Social Security disability, and even if you do, it will not come close to replacing your current income. Disability insurance is a product that you should buy individually from an insurance company. This way, if you become disabled, your business may not have to close down completely because of that.

Disability insurance might actually be more important for small business owners than for other individuals. With most small businesses, the fate of the company rests solely on the ability of the owner to perform her job. If the owner cannot work for even a short amount of time, the business will most likely close down.

Business and Personal

When you are shopping for disability insurance, you may want to look for a policy that will cover both business and personal expenses. There are some disability policies out there for small business owners that will provide you with money to cover your personal bills as well as some of the bills that are incurred by your business. This kind of policy could pay for your mortgage, your groceries, your personal utility bills, and for any business expenses that you still need to pay. This can be a very valuable policy for small business owners, as it keeps both their personal lives and business aspirations intact while they are out of commission from a disability.

BOE Insurance

One type of disability insurance to consider purchasing if you are a business owner is business overhead expenses insurance. A BOE insurance policy will pay for all of the overhead costs that you have as a business owner. If you get hurt, the rent and utilities will still need to be paid for your business. This type of insurance will kick in and pay for all of the fixed expenses that you have.

Cost of Living Adjustment

When you purchase disability insurance, you may want to see if your policy has a cost-of-living adjustment. This is a feature that will increase your benefits as inflation increases and the cost of living goes up. If you are disabled for an extended period, this feature can be very important.


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