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.



BREAKING DOWN '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. Key Person Insurance

    Key person insurance is a life insurance policy that a company ...
  2. Whole Life Insurance

    Whole life insurance provides coverage for the life of the insured ...
  3. Add To Cash Value Option

    A common benefit option on life insurance policies wherein the ...
  4. Buy and Sell Agreement

    A buy and sell agreement is a legally binding agreement used ...
  5. Company Owned Life Insurance - ...

    A type of life insurance policy taken out by a company on the ...
  6. Named Beneficiary

    This term refers to any beneficiary named in a will, a trust, ...
Related Articles
  1. Insurance

    How to Protect Your Income No Matter What

    What does it mean to insure your income? Here are a variety of ways to do it and some insights into when it might make sense to invest in income insurance.
  2. Financial Advisor

    Is Life Insurance From Your Employer Enough?

    Covering the needs of the ones you would leave behind is not easy. But efforts to secure a life insurance policy outside of work should pay off.
  3. Insurance

    Life Insurance: How Long Does It Take To Get Paid?

    How to file for a life insurance payout – and how long it takes to receive it. Plus, new ways to plan for payments that provide an income stream.
  4. Managing Wealth

    Why the Wealthy Should Buy Lots of Life Insurance

    Properly structured life insurance can help in managing, preserving and growing wealth.
  5. Financial Advisor

    Getting Life Insurance in Your 20s Pays Off

    Find out how Americans in their 20s can benefit from a well-thought-out life insurance policy, especially if they are able to build cash value for retirement.
  6. Retirement

    4 Wealth-Building Secrets

    Protect what you have while shifting risk is the motto of the rich. Find out how a life insurance policy can help you do the same.
  7. Insurance

    Tips for Helping Clients with Life Insurance Needs

    Life insurance needs will likely change over the client’s lifetime and again financial advisers can provide an objective sounding board.
  8. Insurance

    3 Things to Know About Life Insurance

    Many life insurance salespeople would prefer you didn't know these three things.
  9. Insurance

    How Much Life Insurance Should You Carry?

    Before purchasing life insurance it important to decide if you really need it, what type of policy is best, and how much coverage you should get.
RELATED FAQS
  1. Why is accidental life insurance so inexpensive?

    Accidental life insurance is an inexpensive way of obtaining life insurance coverage for yourself or someone else in your ... Read Answer >>
Hot Definitions
  1. Cost of Goods Sold - COGS

    Cost of goods sold (COGS) is the direct costs attributable to the production of the goods sold in a company.
  2. Profit and Loss Statement (P&L)

    A financial statement that summarizes the revenues, costs and expenses incurred during a specified period of time, usually ...
  3. Monte Carlo Simulation

    Monte Carlo simulations are used to model the probability of different outcomes in a process that cannot easily be predicted ...
  4. Price Elasticity of Demand

    Price elasticity of demand is a measure of the change in the quantity demanded or purchased of a product in relation to its ...
  5. Sharpe Ratio

    The Sharpe ratio is the average return earned in excess of the risk-free rate per unit of volatility or total risk.
  6. Capital Expenditure (CAPEX)

    Capital expenditure, or CapEx, are funds used by a company to acquire or upgrade physical assets such as property, industrial ...
Trading Center