Business Overhead Expense Coverage

A major risk facing all small business owners is a disability. Business overhead expense coverage keeps your business running while you are disabled by paying pre-existing fixed overhead expenses that continue for the business during a period of disability. Business overhead expense coverage is not the same as traditional disability insurance which replaces part of your income.

By having coverage in place, your customers, creditors and employees can be assured that the business will continue. Creditors are less likely to recall outstanding loans and employees are less likely to quit and work elsewhere allowing you to retain customers because the business continues to operate in the absence of the owner.

Eligible Expenses:

Eligible business expenses are those normally incurred in operating the business or practice, some examples are:

  • Rent
  • Property Insurance Premium
  • Hydro
  • Telephone
  • Postage
  • Heat
  • Water
  • Gas
  • Laundry
  • Janitorial and maintenance services
  • Employees’ salaries
  • Interest on debt
  • Depreciation
  • Accounting and professional fees
  • Union or professional dues
  • Business liability insurance
  • Business taxes
  • Lease costs for office car, work truck, etc.
  • Other normal fixed and customary expenses

Monthly Benefit Maximum:

Maximum benefit amounts vary by insurer but can be typically range from $1,000 to $20,000 per month.

Elimination Period:

This the number days from the onset of the disability one must wait until benefit payments commence. Typically, this will be 30 to 90 days.

Benefit Period:

This the maximum duration that disability benefits are payable for upon satisfying the elimination period. Typically, 12, 18 or 24 months.

Injury or Illness Benefits:

We offer plans that can cover injury and/or illness for disability and business overhead insurance plans. If one is not insurable medically they can still potentially purchase 24-hour injury coverage if uninsurable for the illness portion.

Additional Add-ons or Features:

Some plans will also include options or built-in features such as guaranteed future insurability, cash for medical expenses, waiver of premiums after a set amount of days, return of premium if no claim has been made, conversion options and extensions past age 65.