Life insurance in Drummondville

CWCC works with small and medium business owners, manufacturers and families in Drummondville on life insurance, living benefits, succession planning and capital strategy: entirely online. The firm is registered with the Autorité des marchés financiers under number 602293, where Jose Salloum practises as a Financial Security Advisor.

What makes Drummondville different

Drummondville has a feature few Quebec cities of its size share: its economy rests on a large number of mid-sized companies rather than a handful of large employers. That changes entirely the nature of the risk families here carry.

A dense manufacturing fabric. Food processing, plastics, metal products, furniture, industrial subcontracting. Companies of twenty to two hundred employees, often in their second or third generation.

A tight labour market. Specialised skills are hard to replace, and everyone knows it, on the floor as much as in the office.

Owners who still operate. The head of the business is not an investor: they are in the plant, they know the customers by their first names, and a great deal is written down nowhere.

Normal and substantial business debt. Equipment, expansion, working capital. Lenders are present in nearly every file.

The person whose absence stops the company

This is the central question here, and it is also the one owners recognise immediately when it is put to them, because they already know who it is.

It is not always the owner

In a company of this size there is almost always one person whose immediate departure would create a problem of a different order than filling a position. It is not necessarily the shareholder. Sometimes it is the plant manager who knows the processes, the representative who holds the relationships with the three largest customers, or the foreman around whom an entire shift is organised.

The test is simple, and it is asked out loud: if that person did not come in on Monday, and never again, what would happen over the next twelve months? The answers almost always turn on the same three things: revenue that leaves with the relationship, time and money to recruit and train someone, and a lender asking questions.

What the capital is for

Key person insurance is owned by the company, which pays the premiums and is the beneficiary. The capital does not replace the person: it buys time, which is not the same thing and is often worth more.

That time goes to very concrete things: continuing to meet payroll while sales dip, recruiting without taking the first available candidate, reassuring a lender and customers, and avoiding the sale of assets under pressure.

How the amount is set

Not by feel. It is estimated from things the company’s accountant can quantify: the share of revenue attributable to the relationship, the margin that share represents, the real cost of recruiting and training, and a reasonable period before a replacement is fully productive.

The tax treatment of the premium and of the proceeds depends on the structure and the intended use: that is for your accountant and your tax specialist to determine, and we do not do it in their place.

The policy assigned to a lender

There is a neighbouring situation many owners discover at the moment of signing a financing rather than before.

A lender advancing funds to a company frequently requires that a life insurance policy be assigned as collateral for the debt. That is not the same as being the beneficiary: the assignment gives the lender a first claim on the proceeds, up to what it is owed, and the balance then goes to the named beneficiary.

Three points deserve checking. First, is the assigned policy large enough to cover both the debt and the family’s need, or will the family end up behind the lender with whatever is left? Second, was the assignment released when the loan was repaid? We regularly see assignments sitting on policies whose debt has been extinguished for years. Third, does the assigned policy belong to the right entity?

The Quebec framework

Quebec follows the Civil Code. The liquidator’s role is governed by law, a notarial will does not require probate while a holograph will does, and a common-law partner does not inherit without a will.

For a business owner one point matters particularly: settling an estate that includes an operating company means having it valued while it continues to run. That is a reason to appoint the liquidator on competence rather than on rank within the family.

What we do for companies here

We start by asking the question out loud: who, in this company, cannot be replaced in three months? The owner already knows the answer, and it rarely names only one person.

We then ask for three documents: the latest financial statements, the shareholder agreement if there is one, and a list of policies in force showing, for each, the owner, the beneficiary and any collateral assignment. That last column regularly holds surprises.

We work with your accountant and your legal advisor, before proposing anything.

The first meeting

Half an hour, by video, at no cost and with nothing to sign. Your accountant can attend: it shortens everything, and we much prefer that arrangement. At the end you will know whether this belongs in your company, and if the answer is no, you will hear it during the meeting.

Frequently asked questions