Why Bay of Plenty Business Owners Should Consider Key Person Insurance
Running a business in the Bay of Plenty isn’t just about hard work - it’s about people. Whether you’re a small business owner in Tauranga or a tradesperson based in Mount Maunganui, there’s often one or two key people who keep the wheels turning. But what happens if that person can’t work due to serious illness, injury, or worse?
That’s where Key Person Insurance steps in - and for many Bay of Plenty business owners, it could be the difference between business as usual and financial stress.
What Is Key Person Insurance?
Key Person Insurance is a type of cover that pays your business a lump sum if a crucial employee or business owner becomes seriously ill, disabled, or dies. This money can be used to:
Cover lost revenue
Hire and train a replacement
Pay down business debt
Keep the business running while you adjust
It’s essentially a financial buffer that helps protect your business’s future when the unexpected happens.
Who Needs It?
You might need Key Person Insurance if:
You’re a sole trader and you are the business
You co-own a business and rely heavily on each other’s expertise
You have a key staff member who drives sales, manages client relationships, or holds unique skills
Your business would suffer a financial hit if one person couldn't work for months
Whether you’re a builder in Papamoa, a physio running a small clinic in Tauranga, or a marketing agency owner in Mount Maunganui, if the business depends on you (or someone else), this insurance matters.
Real-World Example:
Sarah and Mike run a boutique design firm in Mount Maunganui. Sarah handles all client acquisition, while Mike leads project delivery. When Mike was unexpectedly diagnosed with cancer, the firm lost its capacity to complete jobs. Their Key Person Insurance payout covered salaries and contractor support while Mike recovered - helping the business stay afloat and clients stay happy.
Why It Matters for Bay of Plenty Businesses
The Bay is full of entrepreneurial spirit, but that also means many businesses here are lean, fast-moving, and reliant on a few key people. Unlike large corporates, small businesses don’t always have backup staff or spare capacity.
Tauranga and Mount Maunganui, in particular, are booming with growth in trades, health services, retail, and tourism - sectors where owner-operators or small teams are the norm. That makes key person risk very real.
How Much Does It Cost?
Key Person Insurance is surprisingly affordable. Premiums depend on:
The level of cover
The person’s age, health, and role
The financial impact of their absence
You can tailor it to your budget and only insure for the financial exposure you’re comfortable with.
Protect What You’ve Built
You’ve worked hard to grow your business - don’t leave it vulnerable. Key Person Insurance gives you breathing room if the unthinkable happens.
At Compound Wealth, we work with Bay of Plenty business owners to create insurance plans that match your structure, goals, and risk level. We can help you figure out whether you need Key Person cover, Shareholder Protection, or Business Continuity Insurance - and we’ll make the process straightforward.
Want to chat about protecting your business? We’re based locally and speak your language - whether you're a sparkie in Papamoa or a café owner in Tauranga. Book a free call or an appointment to come by our office in the Mount.
Compound Wealth are based in Mount Maunganui, Tauranga and offer KiwiSaver, Investment & Retirement Financial Advice to clients all over New Zealand.
