Life insurance important for small business owners

Jul 12, 2011

Small business owners need to take life insurance into account when handling personal finances

A term life insurance policy can be an important safety net for any consumer, but small business owners in particular may want to speak to a financial planner about some sort of policy.

Reports show small businesses are growing at a significant pace, largely because economic struggles have forced many people to rely on their own enterprise for income. A survey by specialist insurer Hiscox revealed while roughly half of small business owners started their own company because it was a dream or desire, 15 percent were forced into that position because of a layoff.

"Whether it's due to a layoff, or to pursue a life's passion, entrepreneurs are starting businesses to take control of their own destiny. Also, they don't need to invent the next new hot idea, but need to put in hard work and provide higher quality service than the competition to succeed," said Kevin Kerridge, small business insurance expert.

While business insurance is an important concern for many of these consumers, they may also want to consider their decision's impact on their life insurance. Some may need to switch from term life insurance to a whole policy to account for the increased financial responsibility that comes with owning a business.

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