Disability Overhead Expenses Insurance


Protecting Your Businesses Bills While You Can’t Work

What is Disability Overhead Expenses Insurance?

Disability Overhead Expense Insurance helps a small business owner maintain their business if they develop a disability that limits or prevents them from running their business efficiently. Disability overhead insurance provides cash to pay business expenses such as:

    • Rent
    • Utilities
    • Insurance Premiums
    • Employee Salaries (other than the business owners)
    • Equipment Lease Expenses
    • Interest on Debt
    • Any other deductible normal overhead expenses
disability overhead insurance for small business 2 Decision Tree Financial

The cash benefit provided by a disability overhead expense insurance policy to pay these expenses is determined by the policies maximum monthly amount and will not exceed actual expenses incurred by the business.

Why a small business owner wants a Disability Overhead Expense Insurance

When a small business owner experiences a disability that prevents them from working in their business at 100% effectiveness, there can be a lot of uncertainty. For example:

    • Loyal customers may begin to look for other suppliers as they don’t want their business to suffer if the disabled owner loses effectiveness.
    • Employees may look for new jobs when they fear for their future.
    • Creditors may reduce or eliminate credit lines if they believe the businesses future is in doubt.

All these things and more can jeopardize a business’s revenue, income, and long-term sustainability.

The benefits from a disability overhead expense insurance policy can be used for:

    • Allowing the business owner the opportunity to assess the severity of their disability and their future without worrying as much about generating the money needed to pay their bills.
    • Give peace of mind to other stakeholders in the business (customers, employees, lenders etc) that the company can continue (“cash flow is king.”)
    • Pay their obligations IF revenue does decrease (Policy pays benefits even if the company’s profits increase during the owner’s disability)
    • Keep the business a going concern so that they can have an enterprise to come back to or start the transition process to new ownership preserving the value of the business.

How much does Disability Overhead Expense Insurance Cost?

The premium you’ll pay will depend on a number of factors, including the age of the business owner, their role in the business, benefit amount, benefit period and any other factor that can influence the price. However, there are some general guidelines you can follow to get an idea of what you might expect to pay for this type of coverage.

Generally speaking, disability overhead insurance premiums will be based on the actual expenses of the business.  The benefit amount and period also play a role in determining the premium. If you’re looking for a longer benefit period or a higher benefit amount, you can expect to pay more for your coverage.

Ultimately, the best way to find out how much disability overhead insurance will cost you is to speak with an insurance agent or broker who specializes in this type of coverage. They’ll be able to give you a more accurate estimate based on your specific situation and needs.

Why Chose Decision Tree Financial to Be Your Disability Insurance Advisor

Decision Tree Financials’ heritage is founded on the power of disability insurance. We know firsthand how important the benefits a disability insurance strategy is to a business owner who has put all their time and effort into building an amazing enterprise and we know that sometimes life doesn’t go as planned. Our promise is to help you understand the risks you face in your business,  develop a strategy to address those risks and find the coverage you need to provide protection against events that could devastate your business.

Having survived cancer twice and dealing with treatment while owning a business, once without a DI overhead policy and once with, you can guess which business survived and which business failed. The second time dealing with treatment and having the right insurance coverage allowed me to focus on fighting and gave me a business to come back to when I was better!

Kevin Wenke, Owner Decision Tree Financial