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Questions and Answers
Which type of business insurance is specifically designed to cover the ongoing operational expenses of a business if the owner becomes disabled?
Which type of business insurance is specifically designed to cover the ongoing operational expenses of a business if the owner becomes disabled?
- Key person insurance
- Business overhead expense policy (correct)
- Business continuation policy
- Disability buy-sell agreement
A business owner wants to ensure that their company can continue to meet its financial obligations, such as rent and utilities, if they become disabled. Which type of insurance policy would best suit this need?
A business owner wants to ensure that their company can continue to meet its financial obligations, such as rent and utilities, if they become disabled. Which type of insurance policy would best suit this need?
- Business overhead expense policy (correct)
- Workers' compensation insurance
- Commercial property insurance
- General liability insurance
Which insurance policy helps a business maintain its operational cash flow by covering ongoing costs when the owner is unable to work due to a disability?
Which insurance policy helps a business maintain its operational cash flow by covering ongoing costs when the owner is unable to work due to a disability?
- Disability buy-out policy
- Errors and omissions insurance
- Business interruption insurance
- Business overhead expense policy (correct)
What is the primary benefit of a business overhead expense policy for a small business owner?
What is the primary benefit of a business overhead expense policy for a small business owner?
If a business owner becomes disabled and unable to manage day-to-day operations, which insurance type is designed to cover expenses such as employee salaries, rent, and utilities?
If a business owner becomes disabled and unable to manage day-to-day operations, which insurance type is designed to cover expenses such as employee salaries, rent, and utilities?
Which policy would BEST assist in maintaining a company's financial stability by covering fixed costs during the period when the owner is receiving treatment for a disability?
Which policy would BEST assist in maintaining a company's financial stability by covering fixed costs during the period when the owner is receiving treatment for a disability?
A small business owner is concerned about how ongoing business expenses will be paid if they become disabled. Which of the following provides coverage for these expenses?
A small business owner is concerned about how ongoing business expenses will be paid if they become disabled. Which of the following provides coverage for these expenses?
An entrepreneur wants to protect her business against the financial strain of covering operational costs if she becomes disabled. Which insurance product is best suited for this scenario?
An entrepreneur wants to protect her business against the financial strain of covering operational costs if she becomes disabled. Which insurance product is best suited for this scenario?
A business owner is evaluating insurance options to safeguard against potential income loss if he becomes disabled. Which type of insurance primarily covers the ongoing operational costs of the business during his disability?
A business owner is evaluating insurance options to safeguard against potential income loss if he becomes disabled. Which type of insurance primarily covers the ongoing operational costs of the business during his disability?
To ensure that a business can continue covering its rent, utilities, and employee salaries should the owner become disabled, which insurance policy is most appropriate?
To ensure that a business can continue covering its rent, utilities, and employee salaries should the owner become disabled, which insurance policy is most appropriate?
Flashcards
Business Overhead Expense Policy
Business Overhead Expense Policy
Covers expenses to keep the business running when the owner is disabled, like rent and utilities.
Business Continuation Policy
Business Continuation Policy
Ensures the business can continue operating smoothly if something happens to the owner.
Disability Buy-Sell Policy
Disability Buy-Sell Policy
Allows partners or co-owners to purchase the disabled owner's share of the business.
Disability Overhead Policy
Disability Overhead Policy
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Study Notes
- The type of business insurance designed to cover the costs of continuing business operations while the owner is disabled is a business overhead expense policy.
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