Business Succession Insurance

The most certain Unplanned Exit Strategy.

When two or more people own a business together, it's important to consider your Exit Strategies. When and how does oneowner, or all of them, leave the business? Are you going to grow it to become a particular size, then sell it? Or, are you building a business for future generations to join and share in the value? The decisions you need to make about your planned exit strategy are critical. Equally, and we think more critical, is your Unplanned Exit Strategy - your Business Succession Plan.

“Also known as Buy-Sell Insurance, this is the most certain way to provide cash to pay you or your family for the transfer of your share of your business enterprise to the remaining owners, if something happens to you.”

Your business and personal wealth are intricately tied together, and it's important that you ensure that your share of the value of your business is returned to your family if you leave before you expect to, through long term or permanent disability, death or a terminal or critical illness. It's also important that your co-owners receive the equity in exchange for your family receiving cash.

Your Unplanned Exit Strategy should be documented in a Business Succession Agreement, also known as a Buy-Sell Agreement, and it should cover the periodic valuation of the business, the intention of the parties, the trigger events such as death, terminal illness, total disability or critical illness, and a very special clause that allows for the instantaneous transfer of the equity to one party or parties, on receipt of the funding proceeds by the exitng owner or their family or representatives.

Business Value Protection Plan

QAI has a proprietary process of discovering and asessing the rigour of your Business Succession Plan. We call it the Business Value Protection Plan. We analyse your business assets and ownership structures, your owners' wishes and the available capital or shortfall available to fund the purchase of equity on a sudden, unexpected exit. If there is insufficient capital we evaluate other funding options and strategies and provide a report on the most appropriate funding method.

We assess the insurability of the owners, and may recommend life insurance as an option for funding, which in most cases is the cheapest, and most certain method of providing cash for the purchase of equity when an insured event takes place.

There are a number of factors to take into account when evaluating and calculating the amount of cover you need for your Business Succession Insurance cover. We have a proprietary system that we use to help you understand and calculate the value of you would need on death, disability or other trigger event, and we help you to assess the needs and insurability, and alternative funding methods available to you.

The QAI Business Owners Value Protection Plan provides a comprehensive evaluation and analysis of your needs, capacity to fund, and alternatives for your Business Succession Strategy. Contact us today to have an obligation free discussion about your needs, our process, and how we can help you to secure your Unplanned Exit Strategy.

General Advice Warning

QA Insurance Pty Ltd as trustee for the QA Insurance Trust (ABN: 59 644 299 394; Corporate Authorised Representative Number:1293763) is an Authorised Representative of QA Insurance Pty Ltd (AFSL 542245). This document has been prepared by QA Insurance Pty Ltd.

QA Insurance advisers are Authorised Representatives of QA Insurance Pty Ltd, AFSL #542245. Information in this document is based on regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by QA Insurance, its related entities, agents and employees for any loss arising from reliance on this document. This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. Taxation considerations are general and based on present taxation laws, rulings and their interpretation and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information. Should you wish to ‘opt out’ of receiving direct marketing material from your adviser, please notify your adviser by email, phone or by writing to us.

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