What does a Business Overhead Expense policy cover?

What does a Business Overhead Expense policy cover?

• A. The owner's personal income while disabled.
• B. Overhead business expenses when the owner is disabled; not personal income.
• C. Paying off the owner's mortgage.
• D. Providing employee payroll benefits.

Answer: (B)

Business Overhead Expense coverage is a disability policy for a business owner that helps the business survive when the owner can’t work. It reimburses ongoing overhead costs so the business can keep operating—things like rent or mortgage on the business space, utilities, office supplies, debt payments on business loans, and payroll to keep employees paid. The crucial point is that this protection is for the business’s expenses, not the owner’s personal income or living expenses. So the best choice describes covering overhead expenses when the owner is disabled and clarifies that it is not personal income.

Business Overhead Expense coverage is a disability policy for a business owner that helps the business survive when the owner can’t work. It reimburses ongoing overhead costs so the business can keep operating—things like rent or mortgage on the business space, utilities, office supplies, debt payments on business loans, and payroll to keep employees paid. The crucial point is that this protection is for the business’s expenses, not the owner’s personal income or living expenses. So the best choice describes covering overhead expenses when the owner is disabled and clarifies that it is not personal income.