When times are tough, many business owners believe that noexpense is too sacred to be spared from the cost-cutting axe.The cost-containment craze of the 21st Century promises to bemore than a passing fancy -- it will remain a key to survival inan increasingly competitive global market. Still, businessowners, particularly of small and medium sized businesses,should take great pains to ensure that their insurance programsare not compromised.

A business owner's need for adequate insurance protection can begreater than the insurance needs of an employee. And whilepeople whose paychecks are signed by someone else quitenaturally have similar concerns as their employers: protectionagainst financial loss that can be brought on by death,disability or insufficient retirement funding, when the employeris hit by these same circumstances -- everyone can suffer.

Think of the many insurance situations that can impact both abusiness and its owner. Most employers don't think twice aboutsecuring property and casualty insurance. These coveragesinclude auto, property and fire insurance. Other business ownerswouldn't think twice about neglecting liability and othercommercial insurance -- necessities for a business when onelawsuit can close it down. The protection afforded by this typeof insurance is easily understood.

It's on the life and health side of the insurance coin that manyemployers have a hard time understanding the consequences. Mostbusiness owners fully understand the basic principles as theyapply to individuals, but what about the effect insurance -- orlack of it -- can have on a workplace?

Insurance is most critical in areas that can't be predicted,"says Leta Finch, director of the Vermont Insurance Institute."Many employers are naive when it comes to assessing risk in theworkplace."

When a business goes through a rough time, the employer feelsthe pain most acutely. But business owners shouldn't foolthemselves: it affects employees, too. When a business suffers,employees feel the stress -- a leading cause of health problemsand disability. As these problems mount -- causing loss ofexperience, expertise and man-hours -- the business suffers evenfurther.

Cutting benefits only adds to the stress. Morale can suffer, andmore often than not, quality and customer service go downhill,too. Perhaps an employer's rationale is that jobs are scarce andemployees have no place else to go. That's short-sighted -- theavailability of qualified workers is as cyclical as the economy.What happens when the employment market opens up again?

Providing employees with access to adequate insurance is one wayemployers can make a lasting impression on a workforce, whileeven maintaining or improving morale. And insurance can help toensure the success of the business in other ways. When employeesare disabled, they can recoup most of a lost paycheck throughdisability income coverage, and the business probably won'tsuffer. Likewise when a business owner becomes disabled, adisability income policy can help restore lost income. But whatabout the business? This is where a Disability Overhead Expensepolicy comes in, providing additional benefits for businessowners to help them defray "fixed" business expenses (such asrent, utilities etc) that must be paid regardless of whether thebusiness owner can work. Life insurance can also be used as ameans of attracting and keeping qualified personnel, and it canalso be used to fund buy-sell agreements.

When employers find insurance premiums hard to take, Finchsuggests another step they can take to contain costs. "Althoughrisk assessment and management is quite common in property andcasualty insurance, it is quite foreign to us on a personallevel," she says. "Personal risk management often comes onlyfrom very tragic lessons learned in life. Clearly, if riskmanagement principles are applied to the disability and healthside of insurance, we can prevent many things from happening,and we can do it affordably.

Business owners buy many kinds of insurance for one reason --protection against potential loss. Bad economic times don'tnormally change those reasons, or a business owner's need forinsurance.

About the author:Herbert Williams is 39 years in the Financial ServicesProfession.Sales Coach, Financial Consultant and BusinessPlanner. For a FREE Consultationon how to write a business planthat will get you the money visithttp://www.money-from-grants.com