As a life insurance agent, you may encounter small business owners or self-employed individuals who are wondering about their insurance options in the wake of the COVID-19 pandemic. With an estimated 8.2 million people choosing self-employment in response to the pandemic, it is important to understand the various life insurance options available to these groups and how to help them determine the right amount of coverage for their needs.
There are several different types of life insurance available to small business owners and self-employed individuals. These options can provide financial protection for their loved ones in the event of their death, as well as protect their businesses from financial risks. As an agent, you can help these individuals understand the value of life insurance and guide them through the process of choosing a policy that meets their specific needs. By doing so, you can help these groups provide financial security for their loved ones and protect their businesses in the event of their death.
Explaining the Different Types of Life Insurance
As a life insurance agent, you may encounter small business owners or self-employed individuals who are unsure about the different types of life insurance available to them. It is important for these groups to understand that even if they have left the formal work environment, they still need to consider life insurance to protect their financial future and the financial wellbeing of those around them.
There are three main types of life insurance that are commonly chosen by small business owners and self-employed individuals:
Personal Life Insurance
This type of policy is tailored to the financial profile of a single individual and names a specific beneficiary in the event of the policyholder's death.
Key Man Life Insurance
This policy is designed to protect a business if a key executive, such as the owner of a small business, becomes incapacitated or passes away. The policy helps to ensure that the business can continue to operate without the key man.
In a small business with multiple owners, a buy-sell agreement is a policy that is taken out to protect each owner in the event that the other owner dies. This helps to ensure that the business can continue to operate smoothly and that the surviving owner is financially compensated.
As a life insurance agent, you can help small business owners and self-employed individuals understand the different types of life insurance available to them and guide them through the process of choosing a policy that meets their specific needs.
Things You Should Consider About the Amount of Coverage You Offer
As a life insurance agent, you have the opportunity to play a crucial role in helping small business owners and self-employed individuals protect their financial futures. By guiding them through the process of choosing the right amount of insurance coverage, you can help them ensure that their loved ones and businesses are financially secure in the event of their death or inability to work.
When determining the right amount of coverage, it is important to consider a range of factors, including the clients' annual income, the number of employees, their assets and resources, overhead costs, debts, and any other insurance policies they may have. By weighing these factors and looking at their income versus their responsibilities, you can help your clients get a better understanding of the policy size that is right for them.
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