It depends on the type. For overhead expense insurance, premiums are generally tax-deductible and the benefits are taxable to the business. For key person disability and buy-sell disability insurance, premiums generally aren’t tax-deductible, and the benefits are generally received tax-free when the premiums aren’t deducted. Get tax advice for your situation.
Business-owned disability insurance
How does business-owned disability insurance impact tax obligations?
Reviewed by Garrett Agencies Ltd., October 2026. How we write
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More about business-owned disability insurance
Disability coverage held by the business, for the owners and people it depends on.
More questions about business-owned disability insurance
- Who is eligible for business-owned disability insurance?
- What are the cost factors for business-owned disability insurance?
- Can business-owned disability insurance be customized?
- What is the process for claiming benefits under business-owned disability insurance?
- What is business-owned disability insurance?
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