Disability Insurance

Business Overhead Expense

Business Overhead Expense (BOE) coverage is designed to reimburse owners of small businesses (e.g., sole proprietorship, partnerships, closely held corporations) - not operated from the home - for normal and customary expenses necessary to maintain the business upon disability of an owner(s).

  • The owner must devote full-time service to the business, occupation or profession and be personally liable for expenses.
  • If the ownership is shared with others, only the insured's pro-rata share of expenses will be covered.
  • The owner must produce substantial income for the business and her or his disability would cause great disruption or even failure of the business.
  • Coverage will not be available if the prospect is overinsured for individual disability income coverage.
  • Benefits over $5,000 per month require documentation of actual expenses from filed business tax returns.
  • If there is other BOE coverage in force with another company, a non-duplication of expense endorsement will be necessary.
  • Employees' salaries - Considered a covered expense for those employees not doing the same duties as the owner.  Employees doing the same duties as the owner will not be considered.
Availability
Size Businesses with fewer than six owners and fewer than 20 employees 
Issue Ages 18-60
Occupation Classes All classes
Waiting Periods 30, 60, and 90 days
Benefit Periods 12, 18, and 24 months
Maximum Monthly Benefit 5M, 4M, 3M, 5A, 4A, 3A:
  $50,000 per month for 12-month benefit period
$40,000 per month for 18-month benefit period
$30,000 per month for 24-month benefit period
2A: $15,000 per month for 12-, 18-, or 24-month benefit period
Minimum Monthly Benefit $1,000
Optional Riders Guarantee of Physical Insurability (GPI) Rider  Additional Monthly Benefit Rider

Disability Buy-Sell

The objective of Disability Buy-Sell insurance is to provide money to assist in the purchase of a disabled owner's interest in a business with two to 10 co-owners in the event of a long-term disability.  Many firms have protection in case of an owner's death, but overlook the financial devastation that can occur as a result of disability. Flexible funding methods are available using lump-sum and/or monthly installment payments, which help to provide the funds to effect an orderly transfer of ownership.

Product Strengths
Size Business with at least two but no more than 10 working owners 
Issue Ages 18-60
Occupation Classes 5M. 4M, 3M, 5A, 4A, 3A, 2A
Elimination Periods 365, 540, 730 days
Benefit Periods Two, three, or five years or lump sum
Maximum Aggregate Benefit $2,000,000 (5M, 4M, 5A, 4A);
$1,000,000 (3M, 3A);
$800,000 (2A)
Minimum policy size $50,000 lump sum;
$1,000 installment, subject to aggregate total
Riders Guarantee of Physical Insurability (GPI) Rider Extended Benefit Rider
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