Keyman Insurance Saves a Successful Business
Can keyman insurance save your business too? Think about who your key person or keyman is when you read the following story on keyman insurance...
Luckily this Australian business had keyman insurance
Ben and Doug were two key forces behind a successful, reputable, Melbourne based Seafood restaurant. The restaurant attracted customers from all over Victoria, and was starring in headlines in both local and state newspapers.
Ben was the head chef and Doug was a skilled sales and marketing person and had just completed the plan for the construction and opening of what was to be a sister restaurant in Sydney.
Tragically, Ben died in a car accident. The kitchen expertise had been lost and the restaurant's reputation for exquisite food was in danger.
This left Doug in a financially vulnerable situation. He needed to replace Ben quickly to ensure that his long standing client base and reputation would not be lost. Doug would need to spend at least $100,000 to go to the market and replace Ben.
Luckily, Ben and Doug took out life insurance to cover the financial difficulty the other would be in should the unexpected occur. Doug had the funds to
- Find and train a suitable replacement
- Cover the short term lost business income and therefore the loss of business profits
- Retire part of the debt owing by the business to secured creditors 1 year after Ben's tragic death, thanks to their key person insurance, Doug was able to open the Sydney restaurant, just as they had planned.
Keyman insurance advice
Keyman Insurance is a specialised field of insurance. It is strongly advised that you consult an xLife adviser who can undertake the detailed analysis of what is required and can tailor the particular keyman insurance package to meet the individual needs of your business.
An xLife adviser will work with you to identify key personnel. The financial cost of their abrupt removal will then be calculated and that person will be insured for a lump sum equal to the loss.
Making such calculations is part of the analysis that a financial adviser covers. Factors that will be taken into account include the proportion of turnover the individual contributed towards. How long will it take before that level of sales or cost will be recovered? ......
Keyman insurance and key person insurance
If you are considering keyman insurance speak to a specialist keyman insurance adviser at xLife. We can offer advice on the best way to structure your keyman insurance policy and also offer recommendations on appropriate levels of cover. Get your free keyman insurance quotes from xLife today.
Exclusive Offer! Call xLife on 1300 135 205 today and
save up to 20% on your first year's keyman insurance premium.
March 2010
