Most businesses are carrying significant financial risk should the unexpected happen.
The big questions you have to ask yourself are:
‘Would your business be able to buy a departing owner’s share of the business if they died or suffered a serious illness or injury?’
‘Would your business be able to cover the loss of revenue and goodwill, and re-pay the debts of the business, if an owner or other key person died or suffered a serious illness or injury?’
If your answer to these questions is no, you need to consider transferring that financial risk to a life insurance company.
There’s an adage that says most of a business’ assets walk out the door at the end of every working day. But what happens if for some unexpected reason one of the key assets can’t come back the next day?
What happens to the business and its ability to operate?
That’s why every business, no matter how small or large, needs a business risk insurance plan.
You can’t see into the future... but you can take financial care of it
Business risk insurance planning is the process of arranging your business affairs in advance to ensure there is no unnecessary deterioration or loss of continuity in your business should it lose you or one of the other owners or other key people through illness, injury or death.
It should also give the continuing owners the ability to buy the interests of the deceased or disabled owner, and ensure that the departing owner or their estate will be fairly compensated for giving up their rights to the business. In this way, a business risk insurance plan provides all owners and their spouses and families with financial certainty should the unforeseen occur.
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