This study aims to investigate the role of CEO succession in family business and the effect on financial risk. Using unbalanced panel data of 48 family firms, we test the disruption, adaptation, stagnation and agency perspective of their behavior. This study finds that CEO turnover is negatively associated with firm’s financial risk. Furthermore, CEO descendants are more risk averse than CEO Founders, and older CEOs are also more risk averse than younger CEOs. This implies that the Indonesian family firms were conservative towards financial risk.