REVEALED WINTER 2024 - Magazine - Page 13
Reasons to Buy Life/Disability Insurance
• Liquidity to buy out a partner or get the
value of the business to an owner’s family.
• Insure against the loss of a key employee
who is vital to the success of the business.
• In the event of a disability, replace an
owner or an employee’s income.
• Cover business overhead expenses if
the owner is sick or hurt for an extended
period.
• Debt repayment/Collateral for Business
Loans
• Employee bene昀椀ts
• Peace of mind
Questions? Contact Brendan@catalyst-sg.com
"Most of our children don't want to take over our lingerie
liquidity to take care of employees and cover overhead while
business," explains Lee. "It's more of a passion project where
everything is sold.
our children, especially if we have sons, don't want to be in the
store, let alone be in charge of it.
Disability insurance is an overlooked element of a business's risk
management plan. If the owner cannot work due to illness, the
"We deal with people in a very intimate space. If they don't have
impact on the business can be signi昀椀cant. Lee notes, "You're in
the same passion for helping, it won't work."
the store 24/7. If you get sick, you can't expect someone to do
Without a clear successor, consulting an insurance expert can
be valuable.
Brendan explains, "If a boutique owner dies and they have
life insurance in place, their family or the business can access
an income tax-free death bene昀椀t. This can keep the company
operating while the family decides what to do with the store.
the same thing on a wing and a prayer. They're going to need to
be paid. And you're going to need something to pay them with."
In those situations, disability overhead expense insurance can
cover monthly overhead for up to a year, ensuring the business
remains 昀椀nancially stable. Additionally, insuring their salaries
allows business owners to protect their income. This protects
them personally and the costs of running the store.
"Also, the business may be worth signi昀椀cantly less without the
owner. There are options for the family to get bought out without
In this world where passion meets business, their future relies
selling the business." If a key employee is interested in taking
on more than a curated collection. It is decidedly unsexy, but a
over, insurance can help with capital to purchase the business.
strategic and comprehensive insurance plan could be a store's
If the plan is to close the business, insurance can provide the
best o昀昀ering.
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