Nine months before Jim Henson's death in 1990, he was negotiating the sale of his Muppets Company to The Walt Disney Company for a reported $150 million.

However, when he died the value of his company plummeted and the deal fell through. It took a further 15 years before Disney’s confidence was restored to the point that a deal could be struck.

Although this is obviously a very high-profile example, the Muppets case highlights the kind of problems that can beset any company that loses a “Key Person” through death or incapacity.

According to National Statistics Online, one in five people aged 40 will not live to see their 60th birthday and the chances of suffering serious illness like a heart attack or cancer over that same period are even worse. The odds are akin to Russian roulette!

All business owners (quite rightly) insure their stock, premises, IT equipment and vehicles against a variety of risks because to lose any of these assets would be financially devastating. But how many people do you know whose business burned down compared with how many people you know who suffered from cancer or a heart attack before reaching retirement age?

Think about who the Key Person or People are in your business (including yourself), then think about what your business would do if one of these Key People had failed to turn up to work on Monday because of death, serious illness or accident.

What would you need to do and how much money would you need to spend to maintain your customers' confidence and to find and train a suitable replacement (temporary or permanent)? Where would the money come from? The loss of a Key Person can make banks nervous, in fact it's not unheard of in such a crisis for banks to freeze or call in existing facilities.

Like your premises, stock, vehicles etc, your Key People are an asset of your business. Usually your biggest asset! And like the other assets mentioned above, the loss of a Key Person due to death or incapacity can be insured against.

This provides your business with a cash facility that can be used to repay bank borrowing, fund recruitment and training of replacements and ultimately allow confidence in the business to be maintained. This will keep your business in business.