By making sure the people involved understand why it’s important, you can transform what can start out a difficult conversation into a useful opportunity for reflection. Which employees would you struggle without? Which products, services and commercial relationships could be affected by their absence? Would financial commitments come into play? Is your succession plan up-to-date? Do you even have one? Are you aware of the insurance products on the market that could give you valuable financial peace of mind?
Consider the impact of the following scenarios on your business:
- A main shareholder is diagnosed with a serious illness which forces them to stop work.
Do you have the funds and means to continue to trade? If that same shareholder were to die, do you have the liquid assets to repay any outstanding liabilities? What would be the impact on the control of the business?
- Your business loses a key sales person who had been negotiating a large and important contract.
Would anyone else be able to pick up the pieces and secure the business? What other key relationships would need to be considered? Could anyone else in the organisation generate the income that would be lost?
- The only person in your organisation who understands compliance dies unexpectedly.
What would the consequences of breaching important regulations be for your business? How much time would it take for someone else to get up to speed? How quickly could you find a permanent replacement?
- You are developing a new product that you anticipate will boost a difficult year but the designer is taken critically ill and will be unable to work for some time.
Could you see the design through to launch without the designer’s expertise? What are the financial implications associated with delay? How quickly could you find someone with the specific expertise you require? Could a competitor steal the march on you?
Losing a key employee, shareholder or partner can have dramatic consequences. Income and profits may fall, loans might have to be repaid at short notice and, at worst, the future of your business could be jeopardised.
It is vital to know that should the worse personal misfortune happen, you have the financial protection in place to ensure you, your employees and your business are secure.