Business Protection Insurance is designed to reduce the financial impact if a Key Person Partner or Shareholder dies or suffers from a critical illness. Business protection insurance specifically covers business loans, partnership or shareholder protection and key persons.
Would your business survive without Business Protection in place? What impact would it have on your business if a key person died or suffered a critical illness and was unable to work?
Business Loan Protection
Many businesses borrow money to get started or to grow the business. Cover is not just limited to commercial loans but can also include personal guarantees and directors’ loan accounts. Death or critical illness could have a significant impact on the company if immediate repayment of the business loan was requested. This could impact on the company’s ability to continue trading.
Partnership and Shareholder protection
If a Partner or Shareholder or in your business were to die or suffer a critical illness could you afford to purchase their share of the business? If not there could be significant implications for the future of your business. Partnership or Shareholder protection can help you protect the ownership of your business should the worst happen.
Partnership or Shareholder protection insurance is designed to provide funds to the surviving partner(s) or shareholder(s) to purchase the shares of a deceased or seriously ill member. It is important to understand the number of shareholders and the value of each shareholding when determining your requirements and amount of cover.
If a business owner, shareholder or partner dies or suffers a critical illness with no shareholder protection in place; his or her share in the business may be passed to their family. The family may choose to become involved in the ongoing running of business or could even sell their share to a competitor. This means that the surviving business owners could lose control of a proportion or, in some circumstances, all of the business. Partnership or Shareholder protection policies can help avoid these circumstances from happened.
Key Person Protection (also known as Key Man Insurance)
A Key Person is someone whom a business relies upon for profit or continued financial success. There are different types of Key Persons within a business including; the founder/owner of the company to whom it relies, senior management, a top or specialist sales person who holds key relationships with customers or even a sole trader. Without them; the business could suffer financial damage with sales and profits falling and increased workloads for the remaining staff.
Key Person Protection is designed to pay out a lump sum on the death of the insured key person, during the length of the policy. It is paid as a lump sum and could significantly help the business to recover. The proceeds can be used to help replace lost profit or finding and hiring a replacement.
The use of trusts plays an essential part when protecting your Business against the impact of serious illness or death. We will provide guidance and support in all aspects of this and happy to work closely with accountants and solicitors in this regard.
Full product information is available on request and can be emailed to you, please call on 0800 043 0413 or email us.