Australia’s startup economy is expanding at a rate of knots. Whether driven by opportunities or grown out of incubation programs, venture capital investments back only a few of these burgeoning enterprises leaving many to fend for themselves. Most of these small businesses are run by individuals who may lack the appropriate funding, especially in unprecedented times. Finding the right human resources, keeping abreast of the ever-changing marketing regulations and managing funds to keep the business afloat are vital challenges for all budding enterprises.
Along with growth opportunities, starting a business also comes with significant risks. Entrepreneurs and business owners alike are encouraged to protect their business and personal life against the threats of growing a business from the ground up. Having a comprehensive safeguard against the unknown is commonly overlooked in a business’s infancy and can undo all the hard work in one fell swoop.
Business owners usually take measures to protect their employees and business by seeking out the most appropriate insurance coverage. However, some don’t accord the same importance in protecting their own income and this can have severe repercussions if injury or illness comes into the equation.
Small and medium business owners should protect their income and assets against adversity and ensure that their family does not suffer the consequences of their inactions. There are many reasons for protecting your income, but here are some of the most crucial ones you need to consider before making the call.
Alternative Means of Income:
If a business owner cannot work, they will have to manage funds to keep the business running as well as their family’s daily expenses. In this situation, income protection cover helps by providing a steady flow of up to 85 percent of their income. In some cases, it can also pay for their ongoing rehabilitation or nursing care.
So, even though the injury or illness restricts your ability to work, you and your family will still have access to the funds required to keep living accordingly. With the necessary funds taken care of, you will have the ability to focus on your health and recovery efforts.
Keeps Your Business Running:
Unlike large scale businesses with deep pockets, the situation can be risky for those who are self-employed, sole traders, working directors or partners. Being unable to work due to illness or injury will mean that though they cannot earn, they still have to pay rent, salaries and fixed expenses.
Income protection can cover these expenses for your business. The cash you get from an income protection policy can be used to pay all the fixed monthly costs and will save you from dipping into your retirement or personal funds to keep the business afloat.
Small Businesses Are More Prone to Risk:
Most startup owners are young – aged between 25-34 years. Launching a new business has many challenges and is always considered risky. When you are young, the risk becomes even more significant as the lack early funds can detract from your ability to overcome unforeseen challenges. if you need capital to inject into the business, there may be fewer banks to aid you and, as result, you’ll have to dig into your savings.
Many small businesses are managed and owned by single or partnership owners. These owners usually bring specific skills to the business. If either partner cannot work due to illness or injury, the business will be adversely affected. With no safety net in place, all personal savings already invested and no banks to come to the rescue, small business owners might face their worst nightmare without comprehensive income protection.
By covering their personal and business income by seeking out proper income protection, critical illness/trauma insurance, among others – small and medium business owners should be prepared for the worst. They can take care of their families and business expenses while recovering from injury or illness. Get in touch with Aspect Underwriting today to explore a wide range of compressive coverage to protect your business and family from uncertainties. You can get a quote in under five minutes here.
Mike Wallis
Mike has over 25 years experience, having spent his first seven years working as a Broker at Jardine Lloyd Thomson in Melbourne and in 2002 was transferred to JLT’s Accident and Health Department in London. For four years (2002 – 2005) Mike was a specialist A&H Lloyd’s Broker and during this time developed excellent relationships with the Lloyd’s A&H underwriting fraternity. In 2006 he returned to Australia in a senior broking position with overall responsibility for Placement Strategy, including the implementation of underwriting facilities and the various authorities granted by Lloyd’s. Mike was the underwriter at two specialist Underwriting Agencies prior to founding Aspect Underwriting in 2016.
