Article:

Securing the future of your business

07 March 2018

Planning for the security and future of your business is an essential part of any business strategy.

You want to know that whatever might happen, all the hours of hard work you’ve put in will be secured for your family and employees.

Getting started

There’s a lot of information out there to help you make decisions about how to protect your business’ future and which types of insurance might be appropriate for you. While it can be useful to research, most business owners don’t have time to wade through and analyse this information.

Everyone’s circumstances are different. The protection you seek will vary depending on the financial status of your company, your own individual goals, the products or services you offer, and a whole range of other factors.

That’s why it’s important to get independent advice that is tailored to your personal situation, rather than assuming a ‘one-size fits all’ approach will work. You, and the needs of your business and family, are unique.

A financial adviser can will assess where your business is at currently and work out the best way to proceed with your individual goals, saving you time and worry.

Case Study

What was the situation?

The client was the owner of a building business specialising in home renovations. He had recently started a family at the age of 35, and wanted to know that, if anything happened to him, he’d have sufficient life insurance and key person insurance to enable his family and his business to continue without him.

What risks did the client consider?

The client wanted to ensure that there was adequate life insurance in place to pay off any personal and home loan debts, as well as provide for the upkeep of his family for an extended period of time in case he died.

He also wanted to have sufficient income protection and disability cover to provide an ongoing income stream in the event he was incapacitated through injury or illness, to help provide for himself and his family.

Further, there was a need for key person insurance to ensure the business could continue in the event of his death or disability. He identified a need to have an insurance payment in place to employ a replacement manager to ensure the completion of existing building projects and help with the ongoing administration of the business.

BDO's Approach

We took the client's individual circumstances into account in order to determine the level of all insurances necessary to maintain his family and business in the event of his death or disability. We also helped him structure it in the most tax effective way.

Top Tips

  • Protect your family by taking out the appropriate level of life and disability insurance
  • Ensure that sufficient insurance is in place to protect the business if the key person dies or is incapacitated temporarily or permanently
  • A tailored approach to insurance will avoid restrictive policies and provide better tax offset options
  • Don't forget to review your estate planning needs so that family members are adequately provided for.

Any advice in this publication is of a general nature only and has not been tailored to your personal circumstances. Please seek personal advice prior to acting on this information. Before making a decision to acquire a financial product, you should obtain and read the Product Disclosure Statement (PDS) relating to that product. Past performance is not a reliable guide to future returns. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way. Opinions constitute our judgement at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document.

Tony Simmons and BDO Private Wealth Advisers (SA) Pty Ltd (trading as BDO Private Wealth Advisers) are Representatives of Godfrey Pembroke Limited ABN 23 002 336 254, an Australian Financial Services Licensee 230690, registered office at 105 –153 Miller St North Sydney NSW 2060 and a member of the National Australia group of companies.

BDO is the brand name for the BDO network and for each of the BDO member firms.