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…
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.*
