Debt Protection

We’ve already talked about [key person cover] and how that can help a business get through a short term problem. What if the illness or accident results in long term or permanent disability. The Key person isn’t designed for the long-term, certainly no more than a year or two so we need a policy that on claim will allow a lump sum to be dropped into the business to pay off that debt.

Besides a business in debt isn’t as appealing to buyers as a business in the black and many of us have businesses with the intention of selling it to fund our retirement and a sudden exit is not the ideal. This is your contingency, your plan B. In the event of a catastrophic end to being in business this allows the business to be sold as a debt free entity either by you or your estate.

If your business runs a debt that it couldn’t afford to pay if the rainmaker stops working through ill health, injury or death then this is a necessity. You don’t want it coming out of your personal [life] or [Disability] insurance.

Yes, like the [key person] cover this is tax deductible too.