Anyone who has ever entered into a new business venture will know about the emotions associated with taking a plunge like this one. First, there’s the excitement that comes with new opportunities as you attempt to navigate an unfamiliar territory. Then, there’s the stress and perhaps even the fear of failure as you soon realise exactly what’s on the line for you and your team. The statistics for start-ups and new ventures don’t paint a promising picture. Around half will close their doors within the first five years. If you’re going to make it work, you need the right kinds of paperwork in place. This ranges from types of cover to employment contracts and even buy and sell agreements.
As any businesses’ most trust ally, Compendium and our team of passionate brokers are always on call to help you make the best possible decisions. This includes providing invaluable information on a host of areas crucial for any business. Where buy and sell insurance agreements are concerned, we have all the necessary insights and expertise required to help you do the best for your new venture.
What does a buy and sell agreement entail?
In short, a buy and sell agreement (also known as buy and sell insurance) is a legal document that outlines specific rules and actions that pertain to a business and those who run it. This serves to safeguard the partners in the entity as well as protect shareholders. By having this document in place, it’s easier to navigate challenging with minimal stress for all parties involved.
How will it help a business?
Change is inevitable in every part of life, especially in the business context. When change arises, some partners in an entity might want to do things differently that could potentially harm the business as a whole. This makes a buy and sell agreement vital to ensure that things can’t just change on a whim.
It’s also useful when it comes to processes that would unfold following the death, injury, incapacitation or retirement of key people in the business. The signed document will outline exactly what must happen in each instance, preventing arguments and delay. Should a partner wish to leave the business, there’s a clear plan of action for how they would bow out. This ensures continuity with limited disruption for the organisation and its staff, allowing it to function as normally as possible. It also guarantees that death and incapacitation of key members is dealt with fairly and sensitively, making the situation simpler for the families of those affected.
There are several types of these agreements
Not every buy and sell agreement will be created equal and it all depends on the business itself and how the owners wish to structure the agreement. Whilst this can get a bit confusing, having a knowledgeable broker on your side to help you draft such an agreement is a sure way to do things right. Should you have any questions about creating a buy and sell agreement for your business, we would love to be of assistance to you.
Your business matters to us too
At Compendium, we understand that starting a new business venture is not without its risks. It’s why we respect every business owner who takes the initiative to create something of their own. In knowing how hard you work to make these dreams a reality, we want to be there for you and your operation in every way that we can. Whether you need insurance or assurance products on a personal or business level, we have a variety of policies that provide total cover for every situation. When you’re properly covered, you can enjoy priceless peace of mind that lets you get back to doing what you do best. This means less stress and less paperwork when you need something done. When you’re busy running a business, why would you want anything less?
If you’re ready to take a few things off of your plate and let our team of professionals handle your portfolio, you know where to find us. To find out more about Compendium and our range of comprehensive products, don’t hesitate to call us now on 087 285 4040.