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.
Business Continuation
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.
Thursday, November 3rd, 2011 | Stuart Henderson | |
In these rocky economic times, business owners have to make tough decisions to keep their businesses healthy and, hopefully, growing. Often when it comes to budget cutting and belt tightening, the first thing to go or to be cut back are employee benefits.
I challenge you to think differently.
Many businesses say that they value their employees, but then they don’t follow through with that statement. If If 
employees don’t think you care about them, they won’t care about you. In our business, we say that our people are our most important asset, and one way we show it is by providing our employees with a generous benefits package. It’s a win-win. Great benefits help us attract employees who are in it for the long term and keep them happy and engaged. Happy, healthy employees are better for our business.
This is some of what we offer:
- 85% employer-paid medical insurance premiums for employees and dependents
- 401(k) plan with 100% employer match up to 3% of pay, then 50% up to the next 2% of pay; average employee deferral of 8.9%
- 100% employer-paid premiums for short- and long-term disability insurance
- 100% employer-paid premiums for long-term care insurance
Now you may say, “Well, we just don’t have the money to do that.” That may be true, or it may be a case of mistaken investment. When it comes to budget time, are you investing in a new roof for your building or in hiring a new salesperson? Or are you making a direct investment in your employees by making sure they have the benefits they need to stay healthy—physically and financially—and happy?
The key is understanding what your employees really want. Surprisingly, many times it’s not more money. While people are certainly motivated by money, you may actually get a better return on your dollar by putting money towards generous benefits instead of raises. A great benefits package allows you to attract a higher level of talent and gain greater engagement while they are at work. We also make sure that we remind employees that they have a rich benefits plan, so that they don’t take it for granted.
Altruism? Or better for the bottom line?
We also offer something that many other companies do not: a long-term care insurance benefit. We’ve found long-term care to be a growing concern for many employees. We pay for 100% of their basic benefit, and offer the opportunity for them to pay for increased coverage as well as get coverage for their spouse. In addition, we searched until we found a policy that is portable. That means they will be able to access their coverage during the years that they will most likely need it most—post working years. True, our company may not see a tangible “benefit” from offering LTCI because the employee will no longer be working for us when using the benefit, but it does send an important message. Offering long-term care insurance tells our employees that we truly value them now—and in the future.
Our goal is to be an employer of choice. One important way we accomplish that is by offering a generous benefits plan. If you believe that people are your most important asset, you must make the investment in them with sufficient measure that they know you care today and into the future.
If I asked you to ballpark the percentage of businesses in the U.S. that are small businesses, what would you say? 25%? 50%? Maybe 75%? The answer is actually astounding: It’s 99.7%, according to the U.S. Small Business Administration. And those businesses employ over half of all private-sector employees. Here are some additional statistics that may surprise you. Small businesses …
• Pay 44 percent of total U.S. private payroll.
• Have generated 64 percent of net new jobs over the past 15 years.
• Create more than half of the nonfarm private gross domestic product (GDP).
• Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).
When you watch the news and read the newspaper, so much more space is taken up covering large corporations. But it’s clear from these numbers that small businesses are a precious national resource, and should be treated as such.
No business is immune to the vagaries of the economy and forces beyond the owner’s control. Life happens—to people and businesses. So if you are a small-business owner, you should ask yourself these questions:
• What will happen to my business if I die?
• What will happen to my business if I become disabled?
• What will happen to my business when I retire?
• What will happen if certain key employees die or become permanently disabled?
• How can I help ensure that my business will be able to weather unforeseen financial hardships?
The answers to these questions most likely include things such as a buy-sell agreement, business overhead insurance, keyperson insurance, and individual disability and life insurance. Sound daunting? It doesn’t have to be. The videos on this small-business planning page can help you with some of the important basics. Then, contact your agent or advisor to get help that is tailored to your specific needs. If you don’t have an advisor, be sure to watch the video that gives you pointers on finding one that is right for you.
Sunday, June 15th, 2008 | jedwards | |
With the high price of gasoline, it came as no surprise to see who is being hurt in a very big way the companies that make gas-guzzling recreational vehicles. The Wall Street Journal reported that Coachman Industries and Fleetwood Enterprises are experiencing slumping sales in large part because of the $4 gallon of gas, and have been forced to take what the newspaper called “drastic” measures to ease the strain.
Coachman’s decision caught the Insurance Word Blog’s attention. To remedy its cash shortage caused by a 40-percent decline in sales over three years, Coachman borrowed against the cash value of the life insurance policies it holds on its highly compensated employees and retirees. (more…)
When should life insurance be utilized for businesses and business owners?
They write whole books about this, but let me list just a few areas where it may be appropriate.
(more…)
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.
