Business Debt Protection
Business debt protection ensures that if a key person dies or is permanently disabled, your business loans and financial obligations can be met — preventing lenders from calling in debts at the worst possible time.
Business debt protection
Protecting your business from the financial consequences of losing a key person
Most business lending is extended on the basis of the business’s performance — and the performance of the key people who drive it. If one of those people is suddenly gone, lenders have the right to review and potentially call in their facilities. Business debt protection prevents that scenario.
Does your business have loans, overdrafts, or other financial obligations that are linked to the performance or guarantee of a key person? What would happen to those obligations if that person died or was permanently disabled? Could the business continue to service them?
Business debt protection pays a lump sum to the business on the death or permanent disability of a key person, specifically to cover outstanding business debts and financial obligations. It is distinct from key person insurance, which covers lost revenue and operational costs.
What's Included
Many lenders require business debt protection as a condition of lending. Even where it is not mandatory, it is a sound business decision that protects all stakeholders from the cascading financial consequences of a key person loss event.
We identify your business’s key financial obligations, assess which are most at risk in the event of a key person loss, and recommend cover that adequately addresses those obligations at an appropriate cost.
Business debt and financial obligation assessment
We identify all of your business’s significant financial obligations — term loans, overdrafts, lease commitments, and personal guarantees — and assess which require insurance protection.
Sum insured aligned to outstanding obligations
We calculate the appropriate sum insured based on your current outstanding business debts and financial obligations, and advise on how to keep the cover aligned as those obligations change over time.
Policy ownership and tax structuring
The policy is typically owned by the business. The tax treatment of premiums and benefits varies by structure. We make sure the policy is set up correctly from the outset.
Lender notification and requirements
Where lenders require business debt protection as a condition of their facilities, we help you meet those requirements and provide the documentation they need.
What people say about Collaborative Consulting
“I got to know John whilst working with him in developing his company’s brand principles to strengthen the emotional connectedness with his clients. During this period, I gained a deep understanding of John’s ethics and strong desire to help people both through the good times and the bad times.
His strongest desire is to make a tangible difference for his clients and future generations of their family. John has a strong sense of family, he believes strongly in wanting to contribute back to the community.
I can honestly say I have not met a financial adviser where money is not the financial driver for him, it’s much more personal, it’s about making a difference. I’d recommend anyone who wants certainty in their financial investments talk to John.”
Michael Major BA (Hons) MDM
Property Development Consultant, Future Proofing Strategist
“John is the consummate professional in the Financial Planning and Investment sector. He has walked the talk, having successfully grown and lead businesses to achieve dramatic results. Through it all, he has helped people reach their personal and professional goals and engages with them comprehensively to ensure they achieve what they need to.
There’s no nonsense with John – if you want to succeed, he will help you do it and in doing so, you will meet and be assisted by one of the nicest and most professional people I know, who also lives by a set of principles steeped in integrity. A hard thing to find these days!
I strongly recommend you contact John and get to know him. You won’t regret it.”
Warren Cummins
Managing Director, Dale Carnegie Auckland and BRS Management
“Choosing someone to look after your money is an important decision especially if you are like me and have no idea about investments.
When I left my marriage I had money from the sale of the house. As I was now on my own financially I understood that I needed to ensure that not only was my money going to be safe but would also be working for my future.
I met with a few financial advisers but none of them really instilled me with confidence. I was feeling a bit lost and frightened about making the wrong decision.
Pam Martin
Arbonne Independent Consultant
“We are all specialists in our own area of business. We love referring our clients to an equally dedicated specialist, John Milner of Collaborative Consulting Ltd.
John has been able to help our clients leverage and re-invest their hard-won gains, made both personally, and in business. John has been working in his area of Investment Expertise for a long- time, so has ridden all of those waves in the marketplace. He is committed to helping clients mitigate their investment risk, and in these days and times, his level-head and thorough but relatable approach to Investment are exactly what we all need.
He makes investing simple, effective and takes the worry away.”
James Kelso
CPA, Director, Kelso Marsh Consulting Ltd
“I have known for some time now as part of my business networking group. From the start I have been impressed by John’s professionalism and his knowledge base. John takes what he does seriously and is quite clearly very dedicated to serving his clients well.
I have no trouble recommending him to anyone in need of sound financial advice.”
Rory Laubscher
Corporate Photography Specialist Firefly Photography
Our Process
When you work with us, we use our proven 3-step system. By understanding your situation and the goals you want to achieve, we work out a unique plan to help you get there smoothly.
Business debt protection that keeps your lenders satisfied and your business secure
Years of experience helping New Zealand businesses protect their financial obligations with well-structured insurance.
Business debt protection is one of the most specific and practical forms of business insurance. It addresses a clearly defined financial risk — the inability to service business debts after a key person loss — in a direct and cost-effective way.
Frequently Asked Questions
Have a question about business debt protection? Get in touch — we are happy to help.
What business debts can be covered?
Business debt protection can cover term loans, overdraft facilities, hire purchase agreements, lease commitments, and personal guarantees provided by key people. We review all your business’s financial obligations to identify what requires cover.
Is business debt protection the same as key person insurance?
No. Key person insurance covers the revenue and operational losses the business suffers when a key person is lost. Business debt protection specifically covers outstanding financial obligations and is intended to satisfy lenders. Both are typically needed for businesses with significant debt and key people.
How does the sum insured change as debts are repaid?
As business debts are repaid, the required sum insured reduces. We recommend reviewing your cover at least annually to make sure it remains aligned with your actual outstanding obligations.
Do lenders require business debt protection?
Many lenders do require evidence of business debt protection as a condition of their facilities. Even where it is not mandatory, it protects the business and its shareholders from having debts called in at the worst possible time.
What happens if the key person changes?
Business debt protection is linked to a specific individual. If the key person changes, the policy needs to be updated to reflect the new arrangement. We help you manage this transition.
Can the policy cover multiple key people?
Yes. If your business has multiple key people whose loss could affect your ability to service debts, we can structure cover for each of them.
Do you work with businesses across New Zealand?
Yes. We advise businesses throughout New Zealand on business debt protection via video call and phone.
Related insurance and financial protection services
With Collaborative Consulting by your side, we can help across a broad range of protection and financial planning needs.
Cover the revenue and operational losses your business suffers when a key person is lost — complementing debt protection for a complete business insurance strategy.
Protect your cash flow and operational capacity during a disruption — ensuring the business can continue to service its obligations even under pressure.
Fund the buyout of a deceased or disabled shareholder’s interest — preventing ownership disputes from compounding an already difficult situation.