Tell the truth—does your home office look a little untidy, cluttered, disorganized? Do you plan to get it under control as soon as you can find the time, but worry that the “time” will never come? If so, you’re not alone.
According to the Bureau of Labor Statistics, 64 percent of self-employed people do at least some work at home. For these entrepreneurs and small-business owners, it can be challenging to keep paperwork under control when there are so many other priorities on their to-do list. And it’s not just a matter of knowing where to put what. Being organized also involves making sure that your business has everything it needs to run smoothly and profitably.
Why not celebrate “Organize Your Home Office Day,” today, March 8, by getting your business environment under control. Start by physically improving your space and then go one step further, reviewing how that space—and by extension, your business—is protected.
A well-organized office is more efficient, more productive and ultimately, more profitable. And carrying the appropriate types of business insurance protects that profitability in the event of unfortunate circumstances or life events. Insurance and other employee benefits can also be attractive incentives to help you recruit the best talent as well as retain and compensate your most valuable team members.
While you may think that property and liability insurance policies are all you or your company needs, you should be aware of other equally important types of business insurance.
The goal of business continuation coverage is to safeguard your family and your business in the event of adversity. Options include individual insurance, keyperson insurance and buy-sell agreements.
- Individual Insurance—As a business owner, you need to carry sufficient insurance to cover any business debts secured by personal assets. Otherwise, your family may be forced to sell or liquidate the business—possibly at a loss—to pay off those debts, which may leave little or no money for their ongoing living expenses. (Not sure how much you need? Use LIFE’s Life Insurance Needs Calculator.)
- Keyperson insurance—Depending on your business, obtaining keyperson insurance on certain employees can be beneficial, since it helps make up for lost sales or earnings or covers the cost of finding or training a replacement should that staff member become disabled or die.
- Buy-Sell Agreements—In a business with shared ownership, a buy-sell agreement allows the co-owners to buy another owner’s share of the business in the event of death, disability or retirement. Buy-sell agreements are typically funded with life insurance policies, allowing remaining business owners to buy the company interests of a co-owner’s share, if he or she were to die, at a previously agreed-upon price. Business owners should also insure against the risk of becoming disabled and unable to work. In this case, disability buy-out insurance would fund the buy-sell agreement, allowing the disabled owner to be bought out, typically after a one-year waiting period.
Employee Benefits—When weighing job offers, candidates review both the pay rate and the compensation package, which can include life, health and disability insurance as well as retirement plans. If you want to recruit and retain the best employees, discuss all the benefits package options (including voluntary benefit programs) with your insurance advisor to make sure you have the right mix.
Executive Compensation—Executive compensation plans, designed for your most valued employees, provide a higher level of benefits and compensation along with significant tax advantages. Options include deferred compensation plans (including SERPs), section 162 plans and supplemental disability income insurance. Again, rely on your insurance advisor for recommendations and information.
While all this information can initially seem overwhelming, your insurance professional can walk you through the details and help you develop a comprehensive plan for protecting your business as well as those who rely on it. Use “Organize Your Home Office Day” as an incentive to arrange a business policy evaluation with your insurance advisor. Then you can relax and enjoy your well-ordered office space, knowing that everything, including your insurance coverage, is well organized and on track.