Like most businesses, yours relies on a number of key people whose experience and ability account for a significant portion of its success.

For example:

• A proprietor, manager, chief financial officer, accountant, programmer, salesman or technical specialist
• Those who help to establish goodwill. Their human attributes and qualities inspire confidence, attract custom, and build clientele
• Individuals who, by association, improve the credit standing of the business.

Significant costs are inevitably incurred, both of a revenue and capital nature, not all of them obvious in the event of a loss of a key person.

These may include:

• A fall in sales or profits until a suitable replacement is found
• Recruitment, specialist training and familiarisation expenses. It takes time and money for a new person to be fully effective
• Others in the business may have their attention diverted, leading to a decrease in productivity
• Liquidity and credit can be affected
• Negative impact on business capital value, goodwill and credit are closely linked. One tends to follow the other.

Why Key Person Insurance matters to your business

Key Person Insurance is a critical component of any comprehensive business insurance plan and is designed to protect against the financial consequences associated with unexpected events affecting key personnel. These may include:

• Sudden death
• Permanent Disability
• Critical Illness (cancer, heart attack, stroke etc)

While it may be possible to accumulate a reserve in preparation for such events or to absorb a reduction in revenue into your business’ current year profits, insuring the key people in your business is usually a much less expensive and far more convenient alternative.

Having the right level of cover can help your company to reduce levels of debt or protect its goodwill by covering capital losses or unexpected costs.

How Steadfast Life can help to protect your business

Steadfast Life will undertake the detailed analysis required to tailor a specific protection package to meet the individual needs of your business.

We will work with you to identify key personnel and the financial cost of their sudden absence, as well as research the market and ensure policies are structured in a comprehensive and cost efficient manner.

The above advice is general.  Before you decide to purchase insurance or retain your existing cover, you should consider whether the advice is appropriate for your financial situation, needs or objectives and consider the applicable Product Disclosure Statement.