I learn a lot about someone and what they think of their family, their business and life in general, when we get around to talking about dealing with life and health issues. There are some things in life that are gray areas and no matter how hard we try to make them black and white, these issues are going to be gray. Upon thoughtful examination there is no one who provides direct concrete and specific guidance about what to do in every matter or every situation. Even the Bible does not speak to every subject specifically. That means that there are some gray areas.

This however is not one of those subjects. Everyone I talk to with regard to his or her business and planning for issues of premature death falls in to one of two, black or white camps. Either they have no concern about what happens to the company once they’re gone; after all they’re gone.

Or the other side is some people care a great deal about what happens in their absence. There is concern about family income and college plans. There often is concern for employees who have worked to make the company successful. Customers need products and services regardless of who is in charge.

However this issue should concern every company owner, because what can happen to the company when the owner is absent will affect the company with the owner present.

Many companies deteriorate or even fail in the absence of the owner. When this happens the owner did not have a business, what he or she really had a pretty good paying job. If the absence of the owner at death leads to the failure of the business, then in the event the owner had lived to sell the company, he would receive less for the company that he otherwise would if the business had a structure in place where someone can run the company successfully in her absence.

If you’re still reading I can see you shaking your head. Why would a dead business owner be concerned about what happened to his business if he had lived? HE’S DEAD! Well he’s not concerned, but those of you alive and still reading should be concerned. Because the very thing that creates a problem when an owner dies is the same thing that creates a problem for an owner who is alive and wants to sell his company. When the business can’t operate in the absence of the owner, the business is worth less when you sell it.

So regardless of age or health, every business owner should be developing a successor or successors who can operate the business regardless of what happens to the owner. If he lives to sell the business, the company is worth more because of it. If he dies before he can sell it, his family still has an asset capable of generating income to live on, employees still have an employer, suppliers still have reliable customers and customers have outlet for the products and services they need. And if her health becomes an issue, the business won’t have to be sold at a fire sale price to raise money for living expenses and medical treatments.

So here’s the $64,000 question. How well can one of your employees or family members run the business in your absence? Can they take care of your customers? Can they anticipate problems? Can they deal with creditors and lenders? Can they lead others to produce the product or service that your company presently delivers? Can they be trusted to do what’s right?

Ok so they can’t right now. What do they need to improve? Do they need incentive? Is there training that is needed? Experience? Relationships? Remember that preparing someone to continue the company makes it more valuable to the owner.

Now if there is a gap between what the business can do with the owner and what it can do without the owner, insurance is a way to make up the difference until someone has the expertise to run the company or to make certain that you receive the value for the business if something goes wrong life and health wise. Insurance buys time or permits assets to be monetized.

What’s the bottom line? Give some thought to what will happen in your absence. Enlist the help of someone who can work through these issues with you. Then have a plan that has or can be communicated to someone who is capable of successfully running the business in the event an unforeseen situation occurs.