Business Continuation Insurance

AAA

DEFINITION of 'Business Continuation Insurance'

Life insurance that a company or firm purchases to provide the funds necessary to continue business and cover the losses incurred in the event of the untimely death or disablement of someone critical to the business. This may be an owner, partner, or other employee without whom the business may cease to operate.



INVESTOPEDIA EXPLAINS 'Business Continuation Insurance'

The two most common types of business continuation insurance policies are entity purchases and cross purchases. Entity purchase policies involve the business itself being named as the owner and beneficiary of the insurance policy. Cross purchase policies mean that the individual owners of the business are named the beneficiaries for policies that cover their partners and/or co-owners.



RELATED TERMS
  1. Business Income Coverage Form

    An insurance policy that covers a company's loss of income due ...
  2. Business Interruption Insurance

    A form of insurance coverage that replaces business income lost ...
  3. Business Owner Policy - BOP

    Insurance policies that combine protection from all major property ...
  4. Premium

    1. The total cost of an option. 2. The difference between the ...
  5. Liability

    A company's legal debts or obligations that arise during the ...
  6. Beneficiary

    Anybody who gains an advantage and/or profits from something. ...
RELATED FAQS
  1. No results found.
Related Articles
  1. Home & Auto

    Cover Your Company With Liability Insurance

    Every business is susceptible to legal action. Find out how to protect yours.
  2. Home & Auto

    The History Of Insurance In America

    Insurance was a latecomer to the American landscape, largely due to the country's unknown risks.
  3. Entrepreneurship

    Will Insurance Keep Your Business Safe?

    Skilled employees are key to a successful business. Find out how to avoid a financial setback if they leave.
  4. Insurance

    Life Insurance: How Much Does Age Raise Your Rate?

    If you need life insurance, try to get it before your next birthday. Here's why.
  5. Retirement

    Healthcare: What Are You Really Paying For?

    Long-term care costs rise fast and long-term care providers bundle services together, making it tougher for families to understand what they are paying for
  6. Retirement

    4 Myths You Don’t Know About Medicare

    Here are four common misconceptions about Medicare, the federal government’s health insurance program for people who are 65 and older or disabled.
  7. Professionals

    Does the Middle-Class Need LTC Insurance?

    Long-term care insurance is as expensive as it is necessary for many people, but is it right for all financial advisor clients?
  8. Insurance

    What Happens If Your Insurance Company Goes Bankrupt?

    When insurance companies go bankrupt or face financial difficulty, it's bad news for policy holders.
  9. Insurance

    Which States Have the Cheapest Home Insurance?

    You can't choose where you live by its insurance rates. But if you did, these are the states to pick.
  10. Insurance

    Obamacare Penalty: What Actually Happens (& When)

    If you didn't have health insurance last year – or miss this year's deadline – how is the Affordable Care Act penalty enforced?

You May Also Like

Hot Definitions
  1. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  2. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  3. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  4. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  5. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
  6. Law Of Supply

    A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity ...
Trading Center