Cummins Financial Services Has The Answer For You. The health and welfare of your business partner is a really important factor in your financial planning. After all, they have probably been working alongside you since you came up with the idea for your business. They also have shared the highs and lows as your business survived those difficult early years, and hopefully has grown as time went on. Your partner has shared the stresses and strains, and hopefully together you've built a business you're both proud of. It wouldn't have been the same, or indeed may not have happened without them.
One of the more important business activities of any company owner or partnership is the whole area of risk management. So what do you think about when you think of something “going wrong”? Is it a fire in a warehouse, an accident involving a company vehicle, maybe somebody tripping and falling in one of your retail outlets? Is it someone suing you for poor performance in your business activities? These are all areas where businesses build contingency plans or put insurance in place.
However, research in the UK has shown that 52% of businesses would cease trading in under a year if a key person died or became critically ill.* This is a risk that you must manage, and thankfully there are solutions available to do just that.
Business Protection
There is a range of business protection solutions available to help businesses survive the death or indeed the serious illness of someone whose loss would result in a financial hit for a business. These solutions provide several benefits for businesses.
• They offer real peace of mind benefits to the directors or partners as they remove the financial worries associated with the death or serious illness of a colleague.
• They remove the need for businesses or surviving partners to borrow money to buy out their partner's share of the business.
• They remove the need for a surviving family member to take the deceased's place in the business.
There are a number of different types of business protection solutions available to suit the different types of business structures.
Co-director's insurance
Each director insures themselves against the death of their co-director, enabling them to buy out their co-director's shares on death, and serious illness if they wish. As an alternative, the insurance can be put in place by the company itself.
Partnership insurance
Similar to the above, a partnership takes out insurance, protecting itself against the death or serious illness of an individual partner, enabling them to compensate the deceased partner's estate for their share of the partnership.
Key person insurance
This helps a business to minimise the impact of the death or serious illness of a key employee. The insurance can be used to quickly attract a replacement employee or indeed to pay off any loans of the company that may have been guaranteed by the deceased.
The key to finding the right solution is getting the right advice. And that's where Cummins Financial Services comes in. If protecting the future of your business is a concern to you, simply give them a call on (052) 744 1487 and they can walk you through your options.
