Starting a business can be an arduous process. One of the most important steps is to secure financing. To ensure you can still pay your payments if you become disabled, some banks require a disability insurance policy to secure the loan. There are policies designed specifically for this need.
Take for example Dr. Jane Dentist. She is purchasing a dental practice for $500,000. Her loan terms require her to pay back the loan in $10,000/month increments for 7 years. She could obtain a policy designed specifically for this need. After a waiting period (typically 90 days), it would pay the bank $10,000/month for the duration of the loan. If she became disabled in the first year, it would continue to pay the rest of the loan. If she became disabled in year 6, it would pay the remaining months.
This is a separate policy from business overhead expense insurance that would pay the overhead expenses to keep the practice running.
There are a few companies available to cover business loans. For more information and to request a quote comparison, please contact Set for Life Insurance today!