Asset Protection

Asset (Debt) Protection can provide your business with enough cash to preserve its asset base so it can repay debts, free up cash flow and maintain its credit standing if a business owner or loan guarantor dies, becomes disabled or suffers a serious illness. It can also release personal guarantees secured by the business owner’s assets (such as the family home).

When asked what their most important assets are, most business owners initially think of physical assets. Yes, they are valuable to every business, but it’s the intellectual capital provided by the key people that typically makes these assets generate the business’ profits.

The Problem

Material things can always be replaced or repaired, but a key person’s death or disablement can result in financial loss more disastrous than any loss of, or damage to, physical assets. When a key person dies, or is permanently disabled, they’re lost to the business forever, which can create immediate financial problems for the business.

Asset sale
Without the security provided by the key person, the business may be forced to sell assets to maintain cash-flow if creditors press for payment and debtors hold back payment. Customers and suppliers may not feel confident in the trading capacity of the business, and its credit rating could fall if lenders are not prepared to extend credit. Outstanding loans owed by the business to the key person may also be called up for immediate repayment.

The Solution

Asset (Debt) Protection can provide the business with enough cash to preserve its asset base so it can repay debts, free up cash-flow, maintain its credit standing and release personal guarantees secured by the business owner’s assets if a business owner or loan guarantor dies or is disabled.