I was recently reminded of the importance of time when I met a family who's time had run short.

I was recently reminded of the importance of time when I met a family who's time had run short.

The husband, a very capable breadwinner, had been managing a successful business for years, until his untimely death changed everything.

The awful effect of not having made adequate provision to ensure the continuance of his company after his death became very apparent.

Key man insurance and-or partnership insurance had not been considered and the result was that his heirs suddenly found themselves facing an incredibly uncertain future.

I have seen and heard of the demise of too many valuable family businesses through the loss of a key executive. The result is that their families' lifestyle, children's education, medical needs and so on all have to be reconsidered and sometimes even adjusted downwards quite dramatically.

Sadly, as life partners we do not always make the time to take action to prevent the devastation that our families will experience when the main income producer is no longer with us.

One should always consider the important events that call for the need of assurance on the lives of key human assets who contribute to the success of the company.

For example:

l The executive may have signed surety or a guarantee on behalf of the company.

If the bank or other creditor is not satisfied with the security available via the other directors, or with assets pledged by the company or the other directors, it could well refuse to agree to the release of the estate. It could in fact demand payment.

It might call up the secured asset of the deceased director. The estate might not be wound up and your heirs could suffer the consequences of long delays.

l Cash flow problems could cripple the company because unsecured creditors might refuse to extend credit. A long slide into oblivion is the possible result.

l The company might be able to continue its business with the proviso that a suitable replacement be employed. Top performers in industry are not readily available for transfer and this is proven by the fact that long notice periods are written into the employment contracts of many companies today.

Of course the high cost of replacement would also have a direct bearing on cash flow. Recruiting a replacement key individual these days is certainly not an inexpensive process.

The first step is to consult a qualified financial planner who will assist you in identifying your needs.

You will be guided to consider really efficient products that will provide the right levels of protection suitable for you.

Life products, like term assurance, are not only specifically designed to do the job for you, they are inexpensive by comparison and you only need to pay premiums for your specified period of time, according to your financial ambitions.

Of interest is that you will very likely pay less for your term cover than you currently do for your car insurance!