Owning a small business can provide a great sense of accomplishment, pride and freedom. It also carries big responsibilities – and risk – for business owners and their families.

Given the day-to-day demands of running a small business, it can be easy for owners to overlook the importance of protecting the true engine of their business: themselves and their employees. No amount of marketing prowess, entrepreneurial spirit, or “elbow grease” can make up for an untimely disability, the loss of a key employee or a lack of business continuation planning.

Using appropriate financial strategies to protect one’s small business can help owners strengthen their bottom line and, just perhaps, sleep a little better at night. After all, business owners have a vested interest in protecting their vital investment. Here are some options from Thrivent Financial to keep in mind.

Business overhead expense insurance

This insurance helps business owners meet monthly business overhead expenses in the event they are disabled for a period of time. While that possibility may seem remote, statistics paint a different picture. According to the Life and Health Insurance for Education, nearly one in three women can expect to suffer a disability that keeps them out of work for 90 days or longer at some point during their working years. For men, the odds are about one in four. And, one worker in seven can expect to be disabled for five or more years before retirement.

Business overhead expense insurance coverage can help keep a business open by paying approved expenses a business owner may incur while he or she is unable to work. This can help preserve client relationships, protect owners from depleting business assets to pay for overhead expenses—such as rents and employee salaries—to help the owner maintain a healthy credit record, and give owners time to recover or make alternative arrangements without the burden of financial worries.

Key employee solutions

Small business owners are constantly faced with the challenge of recruiting and keeping good employees. This is especially true of small businesses where perhaps one or two employees have the knowledge and skills that would be extremely difficult for the business to replace.

Financial tools exist to help protect businesses in this situation, offering tax savings for owners and rewarding employees who make the business what it is. These solutions include:

  • Key person life insurance, which protects businesses from the potential financial impact of a key person’s death.
  • Deferred compensation or salary continuation, which provides a valuable benefit to a key employee without increasing that person’s current income taxes and offers an incentive to stay with the small business.
  • A split dollar plan, which allows the owner and his or her employee to work as a team to obtain the employee’s life insurance coverage with the cash value from the insurance growing on a tax-deferred basis that can be later used by either the business or the employee.
  • Major medical insurance and disability income insurance, which offer important protection for employees in the case of illness or disability.

 Business continuation and valuation

Having the right insurance in place can help small business owners transition their business to the next generation of ownership. For example, a buy-sell agreement identifies a buyer or potential buyer of a business and the conditions under which the sale will occur. This may help settle estates and provide an income stream to beneficiaries. It also helps establish a fair, reasonable price for the business and generates an acknowledged business value for federal estate purposes.

A qualified attorney can help a small business owner draw up a buy-sell agreement. Once in place, the agreement can be funded through several means, including an arrangement with life insurance or disability income buyout insurance on the owner.

Working with qualified professionals, including an attorney, tax professional and financial professional, can assist small business owners in determining and implementing the options most appropriate for their needs.



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This article was prepared by Thrivent Financial for use by Loveland representative FR- Libby Greiwe. She has offices at 423 Wards Corner Road, Suite A in Loveland, OH and can also be reached at (513) 239-2933.

About Thrivent Financial
Thrivent Financial is a financial services organization that helps Christians be wise with money and live generously. As a membership organization, it offers its more than 2.3 million member-owners a broad range of products, services and guidance from financial representatives nationwide. For more than a century it has helped members make wise money choices that reflect their values while providing them opportunities to demonstrate their generosity where they live, work and worship. For more information, visit You can also find us on Facebook and Twitter.

Insurance products issued or offered by Thrivent Financial, the marketing name for Thrivent Financial for Lutherans, Appleton, WI. Not all products are available in all states. Securities and investment advisory services are offered through Thrivent Investment Management Inc., 625 Fourth Ave. S., Minneapolis, MN 55415, a FINRA and SIPC member and a wholly owned subsidiary of Thrivent. Thrivent Financial representatives are registered representatives of Thrivent Investment Management Inc. They are also licensed insurance agents/producers of Thrivent. For additional important information, visit

While diversification can help reduce market risk, it does not eliminate it. Diversification does not assure a profit or protect against loss in a declining market.




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