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Business Risk Management
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business risk management

Business owners and entrepreneurs by nature are risk takers in the marketplace every day.  Many times these leaders only think of insurance as an added expense. It isn't. It is a risk management tool essential to all businesses that reduces the financial consequences of unforeseen events beyond an owner’s or entrepreneur's control. Alternatively, it can be a funding tool to meet liabilities which may arise at an indeterminate point in time.

Arkin Youngentob Associates works with business leaders to design insurance programs that suit business needs and risks. A lifetime of work and dreams can be lost in a minute if you don’t have adequate protection. Deciding what coverage is appropriate takes planning and forethought, just like other aspects of your business. Our process involves asking a range of questions such as:

  • If the benchmarks of your company’s success are tied to its key people—those who create the innovations, lead operations and build the relationships—then what is the risk of losing their expertise and vision?
  • Do your lenders require insurance before giving your business any financing or credit? Would such coverage facilitate a capital raise or corporate financing plan?
  • What would happen to corporate overhead expenses if a key person were unable to work for a period of time?
  • Should the business fund balance sheet liabilities for select executive benefit plans such as deferred compensation or supplemental executive retirement plans?
  • If the successor to a business due to death, disability or retirement of a former principal had to buy the business at a particular point in time, where would they get the funds?

Various types of insurance coverage are available that protect against different types of risks. A business may insure against death, disability, retirement or other trauma for a business partner, a salesperson, the company’s founder, a majority stockholder, its directors or another employee who has unique skills or knowledge. The key to an adequate risk management plan is to understand where potential and real liabilities exist and to structure efficient tax and cost effective techniques to mitigate risk. The experience of the Arkin Youngentob team helps business leaders address these critical financial challenges.

Programs

  • Key Person Life Insurance
  • Business Interruption Insurance
  • Buy/Sell Funding
  • Cost Recovery Funding
  • Aggregate Funded COLI
  • Bank Owned Life Insurance
  • Disability Overhead Protection
  • Disability Buyout Protection
  • Creditor Protection
  • Loan Indemnification Plans

Case Study

Due to a disability, a physician had to enter into an agreement to sell his practice. The physician had a comprehensive disability overhead risk management plan in place. It was recommended that the sale be structured as an asset sale rather than a stock sale. In addition to the sales proceeds, this approach to the transaction enabled the selling physician to collect an additional several hundred thousand dollars of insurance proceeds from his disability overhead protection plan. If a stock sale had occurred, the additional insurance proceeds would have been lost.

The case study results are for illustrative purposes only. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required. No representation is made as to the accurateness of the analysis.

Arkin Youngentob Associates, LLC does not offer legal or tax advice.
We can not say enough good things about Arkin Youngentob Associates. We know we made the right decision when selecting them to handle our business insurance needs. From the beginning, the team has been nothing but professional, customer-service oriented and a knowledgeable resource– always exceeding our expectations.”