No one likes to think that a tragedy or accident will befall them, but they do occur - and they give no warning either.
Novus Marketing Solution’s founder, Brett Riley-Tomlinson, was recently reminded of how quickly things can turn. He missed his footing on the stairs a few weeks ago and slammed his foot into a doorframe as he fell, which resulted in three broken toes and other fractures to his feet. Consequently, as well as being in pain, he couldn’t drive, which meant he couldn’t come into the office or meet clients and prospects in person. Though he could work from home and check in with his team via Zoom, his self-imposed lockdown still had an impact on the business.
From a financial point of view, Brett was able to claim on an accident/sickness policy he held and his income wasn’t hugely affected; without this policy, being self-employed, he would have had much more to worry about than the bandages around his feet.
So, what contingency plans do you have if you were to suffer a fate like Brett’s?
Most business owners, knowing that they don’t have an employer who would pay their wages if they were to fall ill, typically have some sort of policy or protection that covers their wage, or which at least provides some income.
Having a policy is one thing, but have you looked at its terms since you took it out? For instance, some income protection policies only begin to pay out if you’re unable to work for more than a month. Considering that, currently, anyone who has been in contact with a coronavirus-infected person, has to isolate for 14 days, such a policy wouldn’t pay out.
At the other end of the scale, it’s common for policies to pay your wage for only one or two years before they expire – if you, God forbid, had a serious accident that left you unable to work altogether, this wouldn’t meet your long-term needs. It’s not nice to do so, but it is helpful to consider worst case scenarios, so that you can protect yourself against them.
Protecting pay is particularly important for manual workers, as their output directly leads to income. They are their wage. Businesses such as Brett’s, a marketing agency, whilst steered by him, do not physically require him to be there for work to be done. If necessary and able, he could carry out work from his sickbed. But you can’t build a house or rewire a client’s property from the comfort of your own home.
Assuming that your finances are dealt with, what about the running of your business if you were not able to be there? Do you have an appropriate chain of command? Where would future work come from? Who would go and get it? Would you enjoy the same productivity from your employees and would work be carried out to an appropriate quality if you were not there to instigate, motivate or supervise your team? It’s often only when something bad happens that questions like these are asked, but it’s often too late by then.
Business gurus would encourage any business owner to work towards eventually extracting themselves from their business. If your company became self-sustainable, you could sell it for a profit and move on to another challenge. If you are intrinsic to its running and its success - if you are the brand and the only person your clients will do work with - it’s almost impossible to do this.
An insurance broker will ask you: how would you cope if the worst should happen? As Brett can testify, it’s not a question to ignore or put off.
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