Your part in the tragedy (IX) - “Well... that went well enough I suppose”

This time the phone call was neither good news nor truly bad, sad for sure but inevitable. Just a phone call from an accountant to let me know that someone we both knew had finally died after a protracted battle with a degenerative medical condition.

The woman and her late husband had been clients whom we had acted for as individuals, for their family, their former business and for the beneficiaries of their estates.  We attended the funeral, sat quietly near the back of the church and occupied our thoughts with memories of her husband's funeral and what had preceded that. We had met because we both took care of aspects of their affairs that inevitably intersected with each other's areas of expertise and practice. There was a third musketeer, the solicitor who could not be there but he had spoken to us and we agreed to meet the following week.

I had initially met the family through the woman's late husband, J Smith, he owned and ran their business until his death 15 years ago when it was sold to the staff. I initially met him quite separately from his other professional advisers whom I later grew to respect immensely and work quite closely with. The introduction was a referral from his general insurance broker and afforded me a level of qualified respect which I had every opportunity to re-earn and justify over the next five and half years.

After gathering background information from the business owner and looking to the mechanical processes we all follow in practice, I approached the accountant and solicitor for information about estate structures. They were the professional trustees and were concerned that they weren't as aware as they would like to have been of the insurance resources that they would have to work with in the event of a claim occurring.

I outlined the details of the current resources and what I saw as shortfalls and deficiencies. The notional "Fire Drill" helped to demonstrate the gap between desired outcomes and actual outcomes. My concerns related to speed of access to the insurance resources, the relationship (or lack thereof) between the sums in force at the time and the intended use of those claim proceeds and ownership.

A program was put in place to update cover in place, to attach the appropriate types and levels of cover to the individual parties at risk and to ensure that a review process was put in place and its outcomes published to other professional advisers. Each of the initial stages were ticked off and almost all of the major issues were addressed before the world lurched and then started to move, uncertainly at first, but then again as if nothing had happened. What had happened was that J Smith the business owner, was diagnosed with bowel cancer.

Testing times followed. All manner of things were tested; business planning, insurance planning, personal courage, family courage and many other things. The insurance claims - and there were many, began to pay. Medical, income cover and critical illnesses claims all paid. Issues were addressed, obligations were met and paid. Control was gradually re-established and recoveries were made. There were two quite separate and unequal recoveries; a medical recovery which seemed but wasn't complete and a commercial recovery which at best was partial and unconvincing. Life continued, especially for J Smith.

The cancer took a toll on J Smith and all around him. He was able to separate himself from the business that he had started and was now no longer able to contribute to. Succession planning was made to work and was funded through the first year by claim proceeds and then began to show signs of stabilising and then consolidating. The business remained solvent and even profitable but nowhere near as profitable as it had been. The staff ran the business and eventually assumed control and then purchased the business but that was after J Smith had died. The battle ran 51 months and of course was lost but in the end the battle was about the only thing that was lost.

Assets were retained; control and importantly dignity were all retained. When we sat together some weeks later to reflect on the passing of time and people, another interesting thing became apparent to us. From the time of J Smith's illness, to his death, during the intervening years until his wife's death and even now, we all retained our client. The Accountant, The Solicitor, the Trustees, the General Insurance Broker and I still look after the estate, the children and their children, the Business and its new owners and staff.

We could never protect them from the anguish and sadness of losing their health, their independence, their lives or their parents. What we did do collectively was to protect them from uncompleted goals and ambitions. They would have paid off their mortgages and loans given time, they would have built and sold a successful business given time and they would have completed their arrangements and structures to ensure financial independence and security for themselves and for their family, all given time. With the structures, and planning, with the advice and support and with the funding, we helped them to achieve all of these things when time was taken rather than given.

We have worked together along the same lines on many occasions since and regrettably achieved similar outcomes for other people. When we considered everything involved we agreed that for J Smith and his family, what we had set out to do and actually achieved, under the circumstances it all "went well enough".

Allan Mearns is from Vitality Insurance Specialists Ltd, a broking practice working with individuals, their families, estates and businesses.

Vitality is a resource available to individuals and their professional advisers. It gives people information to make better decisions and to have resources that they can depend on when the disablement process threatens to interfere with the rest of their life.

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