| When times are tough, many business owners | | | | of experience, expertise and man-hours -- the |
| believe that no expense is too sacred to be spared | | | | businesssuffers even further. |
| from the cost-cutting axe. The cost-containment | | | | Cutting benefits only adds to the stress. Morale can |
| craze of the 21st Century promisesto be more than | | | | suffer, and more often than not, quality and |
| a passing fancy -- it will remain a key to survival in an | | | | customer service go downhill, too. Perhaps an |
| increasingly competitive global market. Still, business | | | | employer's rationale is that jobsare scarce and |
| owners, particularly of small and medium | | | | employees have no place else to go. That's |
| sizedbusinesses, should take great pains to ensure | | | | short-sighted -- the availability of qualified workers is |
| that their insurance programs are not compromised. | | | | as cyclical as the economy. What happens when the |
| A business owner's need for adequate insurance | | | | employment marketopens up again? |
| protection can be greater than the insurance needs | | | | Providing employees with access to adequate |
| of an employee. And while people whose paychecks | | | | insurance is one way employers can make a lasting |
| are signed by someone else quitenaturally have similar | | | | impression on a workforce, while even maintaining or |
| concerns as their employers: protection against | | | | improving morale. And insurance can help to ensure |
| financial loss that can be brought on by death, | | | | the success of the business in other ways. When |
| disability or insufficient retirement funding, when the | | | | employees are disabled, they can recoup most of a |
| employeris hit by these same circumstances -- | | | | lost paycheck through disability income coverage, and |
| everyone can suffer. | | | | the business probably won't suffer. Likewise when a |
| Think of the many insurance situations that can | | | | business owner becomes disabled, a disability income |
| impact both a business and its owner. Most | | | | policy can help restore lost income. But what about |
| employers don't think twice about securing property | | | | the business? This is where a Disability Overhead |
| and casualty insurance. These coveragesinclude auto, | | | | Expense policy comes in, providing additional benefits |
| property and fire insurance. Other business owners | | | | forbusiness owners to help them defray "fixed" |
| wouldn't think twice about neglecting liability and | | | | business expenses (such as rent, utilities etc) that |
| other commercial insurance -- necessities for a | | | | must be paid regardless of whether the business |
| business when onelawsuit can close it down. The | | | | owner can work. Life insurance canalso be used as a |
| protection afforded by this type of insurance is easily | | | | means of attracting and keeping qualified personnel, |
| understood. | | | | and it can also be used to fund buy-sell agreements. |
| It's on the life and health side of the insurance coin | | | | When employers find insurance premiums hard to |
| that many employers have a hard time understanding | | | | take, Finch suggests another step they can take to |
| the consequences. Most business owners fully | | | | contain costs. "Although risk assessment and |
| understand the basic principles as they apply to | | | | management is quite common in propertyand |
| individuals, but what about the effect insurance -- or | | | | casualty insurance, it is quite foreign to us on a |
| lack of it -- can have on a workplace? | | | | personal level," she says. "Personal risk management |
| Insurance is most critical in areas that can't be | | | | often comes only from very tragic lessons learned in |
| predicted," says Leta Finch, director of the Vermont | | | | life. Clearly, if riskmanagement principles are applied to |
| Insurance Institute. "Many employers are naive when | | | | the disability and health side of insurance, we can |
| it comes to assessing risk in the workplace." | | | | prevent many things from happening, and we can do |
| When a business goes through a rough time, the | | | | it affordably. |
| employer feels the pain most acutely. But business | | | | Business owners buy many kinds of insurance for |
| owners shouldn't fool themselves: it affects | | | | one reason -- protection against potential loss. Bad |
| employees, too. When a businesssuffers, employees | | | | economic times don't normally change those reasons, |
| feel the stress -- a leading cause of health problems | | | | or a business owner's needfor insurance. |
| and disability. As these problems mount -- causing loss | | | | |