1. What is Key Person Protection?
Key Person Protection provides capital injections into the business to assist it in managing the financial impacts of losing a key person.
2. Who might be a key person in my business?
A key person is anyone in the business whose loss would significantly impact the profitability of the company. This could include the risk of a significant drop in revenue and/or the expense of replacing their expertise in the business?
3. What is the process to determine whether I need Key Person Protection?
- Who is a key person and what are his/her key roles and responsibilities in the business?
- What key skills do they bring that drives the financial success of the business?
- In the event they are unable to work for an extended period of time what actions would the business need to take to minimise or mitigate their loss?
- How might those actions affect the financial performance of the business?
Advice Plus will use this information to remodel your company financials to illustrate the potential impact a key person’s loss might have.
Only then, can we understand whether the business has the capacity to tolerate that loss or whether customised Key Person Protection might be required.
4. What type of insurance do I need?
The business strategy may be different depending on whether the Key person has died versus suffered a short to medium term disability. For this reason, life insurance and/or customised disability insurance may be recommended.
Advice Plus will utilise the best solutions currently available in the market to structure a solution that provide you with cashflow when you really need it.
A Key Person risk assessment can be one of the most valuable exercises you do in your business. Call us to discuss whether a free assessment is right for you.