Within an average group of four healthy people, say three males and one female between the ages of 35 to 50, there is a greater than 77 per cent chance that one will die or suffer a critical illness before the age of 64[1], which means many family businesses, which are traditionally under-insured, are at serious risk, according to Norwich Union Australia (NUA).
Within an average group of four healthy people, say three males and one female between the ages of 35 to 50, there is a greater than 77 per cent chance that one will die or suffer a critical illness before the age of 64[1], which means many family businesses, which are traditionally under-insured, are at serious risk, according to Norwich Union Australia (NUA).
The family business sector of the Australian economy makes up around 83 per cent of all business; representing more than $1.2 trillion[2].
This sector also faces business generational change with 60% of family business owners planning to retire in the next 10 years leading to $607 billion in business assets to be transferred to other parties.
Incredibly, seventy per cent of family businesses see succession planning as critical, yet only 12% have a documented plan.
“My advice to concerned family business members is to see a financial adviser as quickly as practicable. Ask them to look up the Norwich Union calculators and work through them with you,” said Allan Griffiths, Group Director of Distribution and Managing Director of Norwich Union Life Australia
“It is critical to protect all the hard work that has gone into the development and expansion of a business,” said Mr Griffiths.
“Our practical assistance helps financial advisers cut through the mystique around business succession planning and allows them to work with clients on the business risk Insurance components of the business succession planning process.
“Business risk insurance and planned legal agreements form an important part of business succession planning and can smooth transfer of ownership between business owners at retirement or in the event of an illness, disablement or even death.
“NUA Business Risk Insurance – In Action” is designed to provide reference information and simplified information guides for advisers to provide risk insurance to the under-serviced small and medium size business sector.”
Norwich Union’s Business Risk Insurance support will help customers to understand:
- risk insurance needs through a case study
- financial needs through a range of calculators and software
- the basics of business risk through to the detail of legal agreements, commercial debt forgiveness and key person insurance.
Comprehensive information exists on the Norwich Union adviser web site and resources are printable for advisers to use with clients, accountants and lawyers.
Visit: www.solutions.norwich-union.com.au
- Norwich Union Life and Critical illness calculator (data obtained from “Pricing Dread Disease Insurance – Fabrizo & Ratton 1994”.
- Monash University Family and Private Business Research Unit 1997
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Allan Griffiths is available for interview.
For further information, please contact:
Bernadette Collins,
Public Affairs Manager, Public Affairs
Norwich Union Australia
(03) 9829 8818