Risk Clinic: Company directors

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Quigley's Fine Wine and Champagne Merchants is looking to take out some business protection in the event that one of the four directors dies. All four - Ryan, Steve, Dave and Jack - are in their mid-forties and in generally good health, although Steve had a mild heart attack a few years ago. What issues should they consider?

Ian Smart, Bright Grey The first issue any small business needs to consider is what they want to protect themselves against. Is it the loss of profit they may suffer following the loss of a key person, being able to repay any borrowing, or cementing the ownership of the business following the death of one of their number? It may be all three but they need to decide which they want to address. The second issue is how to put the cover in place and what cover it should be. Assuming that the business is a company, the directors have a choice of whether it is the plan owner or whether each o...

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