Whether you’re working a side gig or employing hundreds, you’re investing valuable time and expertise in your small business. And while you’re rightly focusing on your goals, you should also consider what you’ll lose if you’re hacked, injured, sued, or faced with any number of other business financial realities.
A business financial checklist can be a great starting place to help protect your financial future. Use the list below to explore what insurance and legacy planning options could be a great fit for your business.
Small business insurance options
1. Individual health insurance
In qualifying states, individual health insurance provides the essential benefits required under the Affordable Care Act. You might also qualify for supplemental insurance to help pay for things not covered by your primary health insurance policy, such as deductibles, private duty nurse fees, extra transportation, and unexpected childcare. This may be helpful to everyone, especially those who aren’t covered through another employer or group.
2. Disability insurance
Short-term and long-term disability covers some of your income to help pay bills, mortgage payments, rent, groceries, and car payments, or if you become totally disabled due to an injury or illness.
3. Life insurance
This insurance provides income to named beneficiaries upon your passing. It can also be used to pay taxes and other transfer expenses, as well as to satisfy debt. Business Life financial products, such as the Buy-Sell Agreement and Key Employee Insurance, can help ensure business continuity in the event of an unexpected occurrence, including the loss of a key employee or the owner.
4. Professional liability
Professional liability insurance protects your business and personal assets in the event of covered claims or lawsuits claiming negligence or failure to perform professional services. This insurance is also known as malpractice or errors and omissions insurance, and it can help businesses that provide services, advice, or guidance, such as accountants, ad agencies, appraisers, bookkeepers, brokers, doctors, engineers, event planners, barbers, beauticians, dentists, financial planners, insurance agents, lawyers, and writers.
5. Workers’ compensation insurance
Since it is required by most states, obtaining this type of insurance as soon as an employee is hired can be a good idea. If your employee gets injured or dies as a result of their job, workers’ compensation insurance provides benefits that can help cover medical treatment, ongoing care, replacement of lost wages, or funeral costs.
6. Business property and contents
A business insurance policy covers your building and other structures where you work or store business property, and covers items such as inventory, furniture, computers, tools, and equipment that could be stolen or lost in a fire or other covered loss. You can also purchase coverage for a business vehicle, mobile equipment, and tools. This type of insurance may help retailers, offices, distributors, restaurateurs, landlords, contractors, and a range of nonprofit and for-profit businesses, both in-home and out-of-home.
Small business legacy planning
1. Succession planning
Do you know what is going to happen to your business in the event of your death? Help protect the future of your business by having a succession plan in place. The plan will indicate your wishes regarding the sale of the business or the appointment of a partner, family member, or employee to assume the responsibilities.
2. Estate planning
It is important to have a plan for your business that conserves and distributes property before and after your death. Among its goals are to provide cash payments for estate expenses, provide income to family members, facilitate the disposition of a business at death, distribute assets to family members and other heirs in a tax-efficient manner, and aid in financial planning for individuals with special needs.
Meet with your State Farm® agent to explore your coverage options and plan for the future of your business.
This post was created by State Farm with Insider Studios.
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The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.
Neither State Farm nor its agents provide tax or legal advice.
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