Chances are slim that you or a key employee will die or face permanent disability while working at your company. That's why policies to guard against these conditions are so affordable. Short-term disability--an inability to work for 90 days or less--is far more common. A nasty flu that develops into a bronchial infection or an automobile accident that leaves you temporarily disabled are just a few examples. So a policy that covers business loss resulting from short-term disability makes sense, right?
Wrong. According to Denver financial planner David Burros, short-term disabilities are so common, and the insurance to cover business loss so expensive, that buying these policies just doesn't make good financial sense. "I recommend anticipating these occurrences and being able to self-fund the impact to the business," Burros says. "For most businesses, that will be the most cost-effective use of their resources."