Plan Your Future provides you with a complete picture of business insurance as well as a simple and practical process for implementation. We can help you to design insurance packages to protect business owners and their families – now and into the future.
It is common that when we think of business insurance, we think of buy/sell arrangements to fund the buy out of a partner who dies or suffers a serious illness or injury. Business insurance is more than just this. It plays a key role in making sure that the business continues to run financially, even though a key person may not be around.
What are some goals of business Insurance?
Succession Planning – buy/sell agreements assist in the transfer of a business to remaining owners.
Keep Business Running – key person cover provides funds to pay expenses and debts or replace lost revenue.
Protect person and family – ensure money is available to pay personal expenses.
Why use Insurance?
Making the decision to insure is made after we have analysed the risk of financial loss caused by an unexpected illness, injury or death to an important person in your business. That cost is then measured against the premium cost for insurance cover. Where the financial loss to the business is large, the insurance is demonstrated as an appropriate solution for risk management.
We realise you have worked hard building your business; don’t let it slip away because you have not considered your risk management options.
Essentially, an insurance policy or combination of policies to help fund financial losses across the business and the key person’s personal situation. We make sure that the policies taken out for business purposes are clearly defined so that not to be confused with those put in place for personal risk management.
So how do we do this?
We need to find out the following:
Plan Your Future will work with your business and liase with solicitors and accountants where necessary. We all have our specialties, so we each bring different expertise.
The Insurance (Risk) Adviser – Plan Your Future. We identify the need for cover and create an insurance solution on:
A Solicitor Provides legal expertise when contracts are required with advice on:
Drafting changes to wills
Drafting transfer agreements and other legal documents
Identifying where Capital Gains Tax (CGT) may arise and how to minimise this with careful preparation of documents
An Accountant Considers the business structure and tax with advice on:
Valuing the business
Confirmation of business structures
Setting up trusts where necessary
Taxation implications on premiums and insurance proceeds
What Types of Insurance are Available?
Plan Your Future will be able to assist you with an analysis of the current business insurance situation. The type of insurance most appropriate for you will be based on this assessment and the types of products available to you explained in terms of the protection they provide. These may include:
Life insurance, or Term Life insurance, provides a cash lump sum in the event of death and in many cases upon diagnosis of terminal illness. This lump sum will be used as per its reason for cover as identified by Plan Your Future. Whether it is to repay business debts, ensure the business has revenue or to successfully transfer on the business to another individual.
Total and Permanent Disablement
Total and permanent disablement typically results in very high medical and rehabilitation costs and also the fact that the person will never be able to return to work. As this greatly affects your business, it is important to consider this insurance. Total and Permanent Disability Insurance (TPD) can be an optional extra on a life insurance policy or taken as a stand alone contract. A claim is usually paid as a lump sum, when the disability meets the policy definitions. TPD insurance covers serious and permanent disablement but does not cover temporary disabilities or many traumas – these are best covered by Income Protection and Trauma policies.
Most of us hear regularly about someone who has been suddenly diagnosed with a serious medical condition like cancer, or has suffered a heart attack or stroke. Unfortunately no matter how healthy someone’s lifestyle, good health doesn’t come with a lifetime guarantee. Having a serious medical illness can affect the ability of key people doing important roles in your business. If they are unable to work at full capacity, or have an extended time off, this will greatly affect your business. Putting a plan in place assists with the continuation of the business. The vast majority of trauma claims stem from cancer, heart attack, cardiovascular disease and stroke.
Income Protection provides staff with a monthly payment while they are unable to produce an income as a result of illness or injury. Many policies will cover up to 75% of most people’s salaries if they are totally or partially disabled. By providing regular payments, Income Protection cover can assist their family to function at a level of financial normality. Income Protection gives people the financial security to focus on recovery or treatment, without worrying about regular expenses. Income Protection policies are very flexible and can be tailored to suit individual circumstances.
Contact Plan Your Future today for a free Insurance consultation.