Dictionary of Exit Planning Terms

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Disability Insurance

During the preparation phase leading up to a sale transaction, one should consider have disability insurance to protect both the company and your family.

Different types of disability insurance can be purchased to:

  1. Provide ongoing compensation to the owner, in lieu of salary
  2. Generate payments to the company to offset lost business
  3. Generate payments to the company to cover overhead expenses, such as debt, rent, and utilities