Contingent Liability PLan

Safeguard your business and its liquidity by getting a contingent liability cover in place for those hard-hitting times ….. such as having to pay back a business loan when there isn’t enough to go by and risk placing your personal estate at the mercy of creditors, leaving little, if anything, for your family to inherent.

ASSESS YOUR MONEY HABITS

Contingent Liability PLan

Safeguard your business and its liquidity by getting a contingent liability cover in place for those hard-hitting times ….. such as having to pay back a business loan when there isn’t enough to go by and risk placing your personal estate at the mercy of creditors, leaving little, if anything, for your family to inherent.

What is it?

When a business entity like a private company, closed corporation or even a trust, borrows money from a financial institution, the directors or partners will need to sign surety for that debt. In the event of the death of one of the directors, the remaining partners will be held liable for the full outstanding amount. (Strict enforcement of the Credit Act means that financial institutions will require businesses to pay any outstanding debt on behalf of a deceased member).

This repayment can become a major problem for the business if they do not have sufficient liquid funds to pay out that debt. If the debt is not paid, the creditworthiness of the business will be adversely affected. A contingent liability plan will help cover these costs and avoid an adverse creditworthy rating. The amount of cover sought should be equal to the debt owed.

Important Note

Strict enforcement of the Credit Act means that financial institutions will require businesses to pay any outstanding debt on behalf of a deceased member. The creditworthiness of the business will be affected by the partners death.

Do you need it?

The test is simple – if you own a business and have borrowed money from a financial institution, you need contingent liability cover.

How much does it cost?

The cost will depend on the cover you need.

How can we help you?

Contact attooh! to find out how we can protect you and your business.

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