What is the core function of benefits from a Business Overhead Expense policy?

The core function of benefits from a Business Overhead Expense policy is to help maintain necessary overhead expenses. This type of policy is designed specifically to cover the ongoing operational costs of a business when the owner becomes disabled and is unable to work. These operational costs may include rent, utilities, salaries for non-owner employees, and other essential business expenses that need to be covered even during periods of owner absence due to illness or injury.

This ensures that the business can continue to operate effectively despite the owner's inability to actively manage it, thus protecting the financial stability of the enterprise. In contrast to other options, such as replacing the owner's salary or funding new ventures, the primary focus of a Business Overhead Expense policy is to cover the routine expenses necessary for the business to keep running smoothly during the owner's recovery, thereby safeguarding the long-term viability of the operation.