LIVELINES: LEGAL BUSINESS ISSUES
Going into business for yourself is a dream come true for most people. But that dream can turn into a nightmare if you aren't prepared when it comes to legal issues, especially when a partner is involved.
Attorney Ed Nanney was our guest this morning. He said business partners should look at the following issues to prepare for the future...
-Business owners should consider how long they can absorb the absence of a key person before the person's ownership should be bought out
-They should also consider how they would cover the increased costs likely to accrue because the person is gone.
-In both instances, insurance coverage can be purchased to reimburse the "buy out" of the disabled person's interest
-There is also "business overhead" coverage which can reimburse some of the additional expenses associated with disability
Ed also gave the following advice when it comes to coverage. He said it is essential that the business owners' documents are congruent with the disability insurance. This means consistent definitions of disability and pertinent time triggers, so that there are no surprises - a contractual obligation between the owners for the buyout but no coverage to reimburse those costs. An attorney can help establish confidence that the terms of the buyout agreement and the terms of the insurance policy are consistent.