What would happen to your business if you were in a car accident and were unconscious for days? Do you have a back up for yourself?
Most business owners are careful to cross-train employees so that in the event, one goes on vacation, quits, or is sick for an extended period, someone can step right in and the business still runs smoothly. If you haven’t gotten to this task, you should cross-train your employees immediately.
What if you have no employees, or you are the only person in your company who knows where everything is, how it should be run and makes all the decisions? An unexpected catastrophe in your life can completely devastate your business. If you want your business to carry you through a catastrophe, you need to plan for it before it comes.
If you are in business with a partner, this is an easy fix. All owners of a business should know everything about the business so that he/she could run the business on his/her own in the event something unexpected should happen to you. If you are in charge of production and your partner is in charge of sales, do each other’s jobs every so often so you and your partner can step in immediately in an emergency.
If you are the sole owner but you have employees, you may want to train a key employee to learn more of the executive functions that you manage now. I know that most business owners do not want their employees to know too much about certain aspects of the business, but you can teach some parts of the business and keep copious notes so that your key employee could learn what he/she doesn’t know from your training. If you never find yourself in a crisis, then you’ve simply done some strategic planning and training that will ultimately make your business stronger.
Are you in business for yourself, with no partners and no employees? Then, you need to find a back-up for yourself. It could be your spouse, other family member, or a friend. You need to let them know everything about your business so they can step in if you have an emergency. This will probably take place over the course of several weeks or months. Keep your back-up informed of any changes as they take place. If your back-up is your spouse, find a second back-up just in case the two of you are in the same accident and both of you are in the hospital. It can happen. You should also have signed a durable power of attorney appointing an agent to act for you when you are incapacitated or unconscious.
Finally, if there is any question in your mind that you will not be able to have an income if an emergency arises and you cannot work, you need to buy disability insurance. This is especially true if your income is derived from you providing a service. If no one can do your job for you while you are incapacitated, you need a mechanism to replace your income. That is what insurance is for.
Robin Gronsky is a lawyer in Ridgewood with a practice concentrating on business law, real estate, and estate planning.
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