The problem with all new businesses is that you do a lot of work first, for which you will get paid later when the business is successful - this is where the risk lies! This is why you need to get key person disability insurance to cover you in this dreadful situation, in a lot of the cases this will make the difference between your business's survival or bankruptcy.
As the entrepreneur when you are trying to identify the key person, most of the time it will be obvious but if you really can't identify him - then you are the key person!
The first step in being able to attain key person disability insurance is a good business plan, yes the same one you will need for the bank for financing etc. As this will determine the potential value of the key person, and the business.
One of the foundations to be able to get key person disability insurance is that you must be able to prove a loss on your side if your key person should become disabled.
Situations where key person disability insurance should be considered is:
- Business Partnerships (as soon as you can afford it)
- New companies
- Employees that is unique and which can not be replaced
- Partners that is unique and which can not be replaced
- Creditors - people that owe you a lot of money (do you want to claim it from their estate?)
- Shareholders - do you want to negotiate with their spouse, or have the spouse as a business partner?
Then ideally you want a lawyer insurance broker combination to help you put all of the key person disability insurance in place, as in a lot of cases there are contracts that must be put in place and most of the time it is not at all that obvious what to do. One contract forgotten can have a devastating effect later!
So as you can see key person disability insurance is an essential part in managing your businesses risks, and sometimes your own risks in the proses, if you have any questions don't hesitate to call, or follow this link to my website: http://sandtonkeymaninsurance.webs.com
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