Key Person and Buy/Sell Insurance
This form of life insurance will determine whether your business survives in the event of the untimely death of one of your key people.
A “key person” is anyone that makes a significant contribution to the profitability of your business. This might be through their experience, special knowledge, intellectual contribution etc.
It is easy to assess your need by simply doing the mental exercise of asking yourself what the business consequences would be if this person was suddenly not there.
Below are some of the consequences of the death of such a key person that this insurance can protect you from:
- The cost required to recruit or train a new employee over the inevitable time delay before they can have them making a full contribution to the business.
- Loss of production and therefore customers.
- Loss of credit rating
- Loans being called up
- Loss of credibility if orders cannot be filled.
- Loss of goodwill
Buying out the interest of a partner who has passed away to protect your business from partners you inherit.
“Buy/sell” insurance allows you to buy out the interest of a deceased partner in the business and it is an important part of business succession planning.
If you were unprotected the death of this partner could mean you would be stuck in a compulsory partnership with one or more of the beneficiaries of their will. They may wish to withdraw their capital or not have the knowledge, experience to be involved in your business.
Click here or call 02 9899 2999 to discuss your situation with one of our specialists Finsura Financial Services Pty Ltd is a corporate authorised representative of Millennium3 Financial Services Pty Ltd ABN 61 094 529 987 Australian Financial Services Licensee Number 244252 Unit 7, 50 Borthwick Ave,Murarrie QLD 4172