Could Death, Injury or Illness Bring your Business to its Knees or Ruin your Retirement Plans?

If you, your business partner or a key employee suffers one of these events then you may be at risk.

Every business owner, partner or company director should review their insurance position with a licensed adviser.

Example 1

Your business partner dies.

  • Can you afford to pay out the deceased party estate’s interest in the business?
  • Will you now have to be in business with the surviving spouse or family members?
  • Will day to day management of the business be disrupted as a result?

Buy/sell cover can make sure the surviving parties own all of the business, ensuring a smooth transition to new ownership,  and the surviving family or estate receive a fair price for their interest in the business in a timely way.

Example 2

Your business partner dies or is incapacitated and there is outstanding debt.

  • What if this incident triggers the bank to now foreclose on the loan? Can you pay it out?
  • Cash flow could be seriously impacted
  • Is there a guarantee or security over business assets or residential property that could now cause hardship?

Debt Protection Insurance provides funding for the debtor entity to discharge bank debt or other debt either partially or in full, and works to limit the business from exposure to financial loss due to inability to service debt.

Example 3

A key person with specialist knowledge or expertise in a specific field dies or suffers a disability. A key person includes an employee, key supplier or professional adviser.

  • Can you find a replacement quickly or at all with those specific skills or knowledge?
  • Did that person have vital personal/business contacts and/or relationships critical to the ongoing success of the business?
  • Will production or new business be impacted?

Key Person Cover protects the business from financial loss in the event of the death or disability of a key person. The policy provides compensation for the business, not the equity holders. It could cover recruitment costs, temporary executive employment costs, additional overheads or compensation for loss of goodwill.

It’s so important not to leave yourself, your family or your business and business partners exposed. For more information about Risk Insurance, contact your adviser today.