Split the farm, not your family

When you’ve worked your entire life building up the family farm, the last thing you want is for it to be sold when you pass away because of a dispute over the distribution of assets.

But when the farm is the major asset in your family’s wealth, ensuring an even split of assets among your spouse and/or children when you die can be a huge challenge.

The key to overcoming this problem is having in place an appropriate life insurance solution, which ensures that your assets will be distributed evenly and help prevent the position where the farm has to be sold.

Life insurance within an estate equalisation strategy can help you minimise the risk of surviving family members fighting over assets, while helping to guarantee the ongoing operation of a farm.

Many farming families find that some children decide to stay on the farm, while others move away and pursue alternative careers. Taking out a life insurance policy can help provide the even distribution of assets among all children, particularly those not on the farm. While the children on the farm receive compensation through ownership of the property, those off the farm receive their benefit of the estate through a life insurance payment.

Without a life cover policy in place, the family member who wants to stay on the farm may have to borrow money to pay-out the children who do not want to. Depending on the value of the farm, the cost of borrowing to compensate the other family members could be very significant and leave them with no other option but to sell the farm.

Taking out a life insurance policy provides peace of mind that the farm will stay in the family, and there will be an even distribution of assets among your children.