Disability Buy-out Insurance
Definition of "Disability buy-out insurance"
Buy-sell agreements found in partnerships, sole proprietorships, and close corporations. Either the business entity or the surviving members of the business agree to buy out the interest of a disabled member according to a predetermined formula funded through insurance. Disability buy-out insurance can be more important to a business than death buy-out insurance because the chances of becoming disabled are 7 to 10 times greater than death, depending on the age of the individual. The mechanisms available for the disability buy-out are the same as those found under business life and health insurance.
Popular Insurance Terms
Coverage in the event that stock sent to others for processing is damaged or destroyed en route or at their premises except those perils specifically excluded. For example, this coverage ...
Savings accounts that have tax advantages combined with health insurance plans for the benefit of the employee. Both the employee and the employer are permitted to contribute to the MSA. ...
Policy whose premiums, cash value, and face amount are guaranteed (all values are fixed and do not fluctuate according to the loss experience, expenses, and investment returns of the ...
Modified endowment insurance policy under which the insured receives one-half the death benefit as the maturity value of the policy. ...
Tax assessed by the states as a payroll tax on employers to pay for unemployment compensation ...
Insurance on the life of the employee, paid for by the company, with the company being the beneficiary under the policy. This insurance vehicle is being used more and more to fund ...
Section of the Internal Revenue Code that provides for SIMPLIFIED EMPLOYEE PENSIONS (SEP). ...
Same as term Graduated Life Table: mortality table that reflects irregularities from age to age due to chance fluctuations in the sequence of the rates of mortality. The rates of death as ...
Same as term Master policy: single contract coverage on a group basis issued to an employer. Group members receive certificates as evidence of membership summarizing benefits provided. ...
Have a question or comment?
We're here to help.