We know the amount of effort and personal sacrifice it takes to build and run a business. Delivering goods or services, watching the costs, getting the right connections and the right people in place are keys to success. Your wealth is generated and often locked up in your business.
However, what would you do should one of the partners in your business suddenly die or suffer total and permanent disablement? What do you think would happen to his or her share in the business? Without Business Succession planning and without a formalised Buy/Sell agreement, one of the following outcomes may occur:
- The deceased’s estate may demand a payout of a size that will force your business to be sold.
- The heirs may insist on direct involvement in your businesses operations even though they may lack the necessary skills.
Business Insurance is a simple concept that aims to remove the worry and financial hardship these unplanned events can cause. There are three areas of business insurance:
- Key Person Insurance
- Business Succession Planning
- Guarantor Protection
In this month’s newsletter we’ll explore the needs and benefits of Business Succession Planning.
What is Business Succession Planning?
Business Succession planning is an arrangement which ensures business ownership can be transferred effectively to the right party at the right price with the funding provided.
Know the Risks
According to the Australian Bureau of Statistics (2008), around 2,500 Australians die each week and no one business, occupation or age group is immune.
Source: Zurich Mortality and Morbidity calculator, 2004.
Business Insurance is a specialised field of insurance and Matrium Financial Services have a strong history of Succession Planning. We can ensure a tailored protection package is established to meet the individual needs of your business. For more information on our Business Protection Services, please call our office on 02 8818 3255.