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Business Protection: Key Person Cover

Business protection: key person cover

If you’re a business owner, do you have business protection? If not, Suzanne Jeakins, independent financial advisor with Jones & Co, advises you to ask yourself this pertinent question…

Suzanne Jeakins discusses the importance of business protection

Who’s keeping your Business on track?

“The most valuable asset to any business is its people,” explains Suzanne. “Without them a company’s survival can be at serious risk. Any member of your team who has a direct impact on the profit of your business is a ‘Key Person’.  This could be ‘You’ the business owner, one of your directors, a salesperson or an employee with particular skills or expertise in a specific area. You insure your business property and stock, but what about your key people?”

 

Key Person Cover

Continues Suzanne: “No-one can foretell the future, however, losing a key person can have an impact on the long-term survival of your business. You could potentially lose vital knowledge and skills, which could affect a number of key business areas:

  • Sales could fall
  • Loans may be called by lenders
  • Suppliers may change the terms of credit
  • Customers may go elsewhere
  • You may have high recruitment costs to cover

“Whilst we can’t predict, we can plan and protect. Key Person Cover will provide a financial safety net in the event a key member of your staff dies or is diagnosed with a critical illness. The proceeds of the policy can deliver a cash injection directly to your business.”

Protect your business

Concludes Suzanne: “We work with a wide variety of organisations and SMEs across a number of different sectors to offer professional advice on how to protect that business. If you’d like to arrange a free consultation to discuss how best to protect your business, please don’t hesitate to talk to us.”

*Source of facts – State of the nation’s SME report, Legal and General 2019

 

Many business owners agree that the loss of a key employee can have dire consequences for their business, yet only 18% had considered cover for the illness or death of a key person, and 52% say they would cease trading within one year*

 

In a recent survey, 61% of business owners said that a key employee dying or suffering a critical illness would have the most impact on their business. Yet only 43% have any life cover in place in the event of this occurring.*
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