Entrepreneurial spirits

It may be because we are natural optimists, but it is remarkably common for entrepreneurs not to take out life insurance. Without proper life insurance protection, the sudden death or disability of a founder could derail a company, resulting in layoffs, bankruptcy and possibly the collapse of the business itself.

According to insurance industry studies, 41 percent of business owners and individuals do not have life insurance, meaning they likely don’t have the necessary funds earmarked to support their business, employees and their loved ones in the event that something happens to them.

Mind over matter

Entrepreneurs have a unique mindset and perspective that sets them apart from other professionals or even artists. Their company is born with a mission in mind, and this creates individuals who tend to be both persistent and impatient yet disciplined. When launching a business, entrepreneurs are supported by investors, teams, and their families who all share in their company’s vision, but these groups are also the most at risk should that vision be cut short by an unforeseen event. Without proper life insurance protection, the sudden death or disability of a founder could derail a company, resulting in layoffs, bankruptcy and possibly the collapse of the business itself. There are various reasons that entrepreneurs may neglect to take out an adequate life insurance plan. Establishing protection for themselves is rarely a top priority when starting a business, as finances are stretched, and owners are subject to a never-ending to-do list.

Penny wise, Pound foolish

Most new entrepreneurs will know that, at the onset, their income will be virtually non-existent. As with most small business owners, they will be drilling down into their own savings to invest in their venture. In order to feel comfortable about risking their short-term financial future, they should know that they are putting their family at risk. No one likes to think about the unexpected events that could occur, such as an injury, disability or even death, to yourself or a business partner, but a good business person should anticipate all possibilities whether they are positive or negative.

However, we should as entrepreneurs recognize that from the onset, we are putting ourselves, our business, and our family at risk if we fail to take out adequate insurance.

Protection racket

From a business perspective, it is a smart idea to take out life insurance, which can protect your company from financial loss, liabilities, or instability in the case of death.