In the event of the death of a key colleague, key person insurance can help keep your business afloat. Here’s what to consider. No one wants to consider the death of a colleague. But if such a tragedy could lead to your company’s demise, then key person insurance is a worthwhile precaution. It is life insurance on specific people in a business and is beneficial when a company’s survival relies heavily on the role of one or two people.
Some small business owners don’t understand that they need key person insurance, in addition to life and disability insurance, because it’s designed to protect the business. If your company employs more than one person, review the basics below to determine whether it makes sense for you:
Typically, key person insurance covers the owner, the founders or one or two key employees.
Your business would pay annual premiums and be the beneficiary under the policy. If a key person unexpectedly dies, the company would receive the insurance payoff. When reviewing packages, get quotes on different amounts—say, $100,000 versus $500,000. Your decision should take into account what your budget allows versus how much money the company would need to survive while bringing a new person up to speed.
As to how benefits get paid out, variations abound. The money can pay off debts, distribute money to investors or cover day-to-day expenses. You could also split the premium and death benefit between the firm and the spouse of the key person.
Car insurers spend truckloads of money on advertising to lure customers away from the competition, and the promises of lower rates might be tempting. But take stock of what you’ve got before you split. You might find that the perks for staying with your current insurer outweigh the ones offered by another company. Carriers are differentiating themselves with a variety of offerings, so you have to take extra care when comparing. Here are some upsides to staying loyal to your current carrier.
The most obvious is the loyalty discount, also called a persistency, longevity or tenure discount, which gives you a small rate cut for staying with the company for a certain amount of time. They usually range from about 2 to 10 percent, but not all insurers offer them. The length of time you have to remain with a company for a discount varies by insurer and location. Some insurers also offer discounts for switching to them, which might cancel out any benefit of a loyalty discount with your current insurer.
Some insurance companies now offer accident forgiveness programs, which promise not to raise your rate the first time you have an accident after a period of remaining claim-free. Rules for the programs vary, but some insurers require you to be a customer for a certain number of years before you qualify. Accident surcharges can be hefty and last for years.
Some carriers offer “Vanishing Deductible” programs that promise to reduce your deductible each year you drive safely and are signed up with the program. Your deductible could decrease by $100 a year up to $500. Some companies will knock money off the deductible if you haven’t had any accidents or violations, even if you had coverage with another company. Losing deductible dollars and accident forgiveness might be a bigger deal than losing a loyalty discount when changing companies.
Some companies might be more lenient about minor accidents or violations with longtime customers, even without a formal accident forgiveness program. Another perk for loyalty is that once you’ve been with a company for a number of years, the insurer generally won’t pull your driving record every year, which could save you from an immediate premium increase if you get a ticket. If you’re a longtime customer with a good track record, an insurer is also more likely to reinstate your policy without any penalty if you’re a little late on a premium payment.
For some folks, having a personal relationship with an insurance agent is important. You’ll lose that professional if you’re with a company that has its own agents and you change insurers. You can keep your independent insurance agent as long as you switch to one of the insurers represented by the agency.
Deciding whether to switch insurance companies comes down to weighing what you have to gain and what you have to lose. As a consumer it’s smart to shop, but you want to make sure you’re getting the same policy as before. Or at least you want to make sure you take into account anything you might lose to calculate the true savings.
It’s not too late to order gifts for your family or employees from two of our valued clients, American Housekeeping and Soundburst Audio. Just visit our special Offers page.
When a person dies, their assets are given to their heirs. But, who gets what? That’s why you need a will. Through it, you leave instructions for the disposition of your assets. Typically, wills tell:
Like financial plans, estate plans require periodic review to make sure they remain current and viable. You should review your estate plan – and your will – if:
If you die without having written your own, your estate will use a standard one written by your state government. It’s called dying intestate and, if you rely on it, you give up the opportunity to disburse your assets as you wish. Odds are, in fact, that you won’t like what the state will do with your assets. For example, in some states, if you have children from a prior marriage, dying intestate means your spouse gets only one-third of your assets, the kids get two-thirds. In other states, intestacy means assets might pass to parents, in-laws, brothers and sisters, or even aunts, uncles, and cousins instead of the people you wish. Furthermore, failing to write a will means you give up the right to name a guardian for your minor children. Do you really want a judge to make that decision for you?
With no spouse or children, many single people think they don’t need a will, but this is wrong. Why? Because even single people have debts, assets, and family members, and instructions still are needed. Do you want your parents to receive your assets or would you rather split your assets among your siblings? What if you want to leave money for nieces or nephews for their college education? Without a will, your family won’t know your intentions and, hence, your wishes will not be enacted.
Source: Ric Edelman
See our “Offers” page for great prices on The Piano Guys Christmas CDs.
The startup MetroMile has been turning heads over the past several months as it’s begun testing its pay-per-mile auto insurance offering in the environmentally friendly Pacific Northwest. After a few months of availability in Oregon, the company has now moved into Washington — and more states are on the way.
“MetroMile is bringing its flagship service, the country’s only pay-per-mile car insurance, to Washington drivers,” it wrote in a statement today. “The company is also planning to launch in additional markets in early 2014 and throughout the year.”
MetroMile has designed its insurance product for people who drive less than 10,000 miles per year. So it’s no surprise that it’s pushing hard in urban areas known for their openness to driving alternatives. The company is offering its Metronome telematics device free on a first-come, first-serve basis to drivers in San Francisco, Seattle, and Portland, Ore. so they can try some of its other services — including analytics and modeling technology that monitors gas use and maintenance needs — before they potentially buy (There is no obligation to purchase coverage after a trial). Metromile’s new iOS app, also launched today, provides users quick access to that valuable information.
“Our early users will receive first access to features that quantify the hidden costs of car use,” said Dan Preston, Chief Technology Officer at MetroMile, in a statement. “Over time, we expect to deliver even more data, insights and services that help them solve the challenges they face in their day-to-day car use.”
MetroMile lists these key features of its app:
“People living in cities often drive less than half the national average. Insurance can be the majority of their cost of operating a car,” said Steve Pretre, CEO of MetroMile, in a statement. “We are working to break the old model of one-size-fits-all insurance rates by aligning what people pay with the amount they drive. It’s fair, it’s transparent, and it gives drivers more control over their costs. We’ve proven the concept in Portland and are now taking the service to other cities, starting with Seattle.”
(Reprinted from Insurance & Technology.)
Here are five mistakes to avoid during the auto insurance claims process:
1. CONTACT THE INSURANCE COMPANY
After an accident, report the accident to your insurance company within 24 hours. Do not delay. The longer you delay, the slower the process. Even if you think the other person was at fault, let your insurance company know. At least, if you have collision coverage, they can start trying to fix your car.
2. DOCUMENT YOUR CLAIM WITH PICTURES
Take pictures of everything. Take pictures of the accident scene, any debris, skid marks, your car, the other person’s car and any visible injuries. A picture tells a thousand words!
3. GET YOUR OWN ESTIMATES
Yes, the insurance company will recommend a body shop. However, you need to find a body shop based on referrals from friends and family. Go there and get your own estimate.
4. BE PLEASANT
The insurance adjuster is not your friend. However, the adjuster is a person and you should treat him or her that way. Even when I completely disagree with an adjuster, I don’t treat them poorly or yell at them. Being pleasant can make a world of difference.
5. GO TO THE DOCTOR
Even if you are not sure if you are hurt, go to the doctor. Let them examine you. It could take a few days or weeks for you to feel pain. Once you do, go to the doctor. If your airbags went off, go right away. The powder from the airbags can cause small burns.
Remember, the insurance adjusters have a checklist that they use on every claim. And they do this all day, every day. You don’t have that luxury. Avoid these mistakes and you will go a long way to making sure your claim goes smoothly.
1. A current copy of your data is always outside the disaster zone. Your data stays high and dry in the cloud, no matter what’s happening back at your home or office.
2. You’ve got a third-party team offsite, unaffected by the disaster, who can restore your critical system in the cloud, while you and/or your staff focus on restoring order onsite.
3. You have on-demand access to a virtually unlimited resource—for exactly as long as you need it. Until your sites are back online, keep your systems up and running by shifting services to the cloud.
4. Even if your home or office isn’t ready for your return, you have secure remote access to critical systems, applications, and data in the cloud for as long as you need it.
5. Faster, cheaper, better: Cloud technology enables vastly more-efficient and secure data transfers and storage, plus disk-to-disk remote recovery. No hefty upfront infrastructure costs. No more worrying “IF” your onsite backup will survive a disaster.
Home fires on Thanksgiving nearly double from any other day of the year. Here are some tips to protect your holiday celebration: