There are 2 aspects of business insurance that we specialize in. They are Key Person insurance and Partnership Protection Insurance (otherwise known as a Buy/Sell Agreement).
Most businesses have one or more individuals whose contribution to the business is so valuable that they are referred to as a key person.
Their unexpected removal from the business could result in a significant impact on revenue, profit or other financial aspects of a business (eg goodwill, ability to repay debt and other expenses, access to credit, business contacts and customers).
Key person insurance is essentially life, total and permanent disablement (TPD) and trauma insurance policies taken out by a business on the life of a key person.
Where this insurance is taken out and a key person is unable to perform their duties due to an insurable event (death, disablement or a specified medical condition), the business can use the insurance proceeds to replace lost revenue, repay debt, cover additional expense items or inject required capital into the business.
Key person insurance would ensure that the business is supported financially until a replacement is found.
If you own a business in partnership with another individual (family or not), then the death of your business partner can cause many headaches and problems.
Partnership protection insurance (along with a buy/sell agreement) ensures that in the event of a business partners death, the surviving partner receives full ownership in the business whilst the estate of the deceased receives a fair value for his/her share in the business.