If you own your own business, you'll have insurance in place for
your buildings, stock and vehicles, and you will be likely to
have public liability insurance. You may also be insured for
professional indemnity and legal costs - but have you considered
insuring your most important assets - your key staff?
In the UK there are 3.9 million small, often family, businesses
with up to four employees - if one of those key staff were to
die or fall seriously ill, it could mean the end of the
business, and this goes for limited companies, partnerships and
sole traders.
If you are one of those people then you should seriously
consider Keyman Insurance, and here's why. Keyman Insurance
financially protects businesses from the effects of serious
illness or death of staff who are central to the success of the
company. It does this by providing cash when you need it most,
so you can cover loss of profits, inject more cash into the
business, or take on temporary staff.
There are actually four different types of Keyman Insurance:
* to help your business recover during the time that your key
person is away from work, or to train/take on somebody new;
* insurance against loss of profits;
* to provide protection for shareholders or partnership
interests; and
* for people providing businesses loans or banking facilities.
1 Protecting your business if a key person is away from work
Your key people are the ones who are an essential driving force
in your business - the people who if they were away from work
for a long period, your business would suffer greatly. This
could mean a reduction of sales and profits, or it could mean
your business is shaken to the core. Look at the Directors,
Partners, owners, think about your senior managers - every
business is different but the key people will soon become
apparent to you.
Insuring these people will ensure that if they are ill or die,
you will have the cash you need to take on someone new, or train
a replacement.
2 Keyman Insurance to insure against loss of profits
Losing key staff can have huge ramifications, if they are
central to the success of the business then their loss could
leave you facing bankruptcy. It's a good idea to insure against
this possibility.
3 Keyman Insurance for Shareholders or Partners
In this case, the insurance will protect the company if
shareholders or partners become seriously ill or die. Families
may want to sell their share in the company which leaves the
remaining members open to newcomers entering the business.
Keyman insurance schemes can be used to provide capital to
purchase the shares from the original shareholders or their
estate.
4 Keyman Insurance insuring Guarantors
Many small and new businesses are required to provide a personal
guarantee or a charge on their personal property when they take
out a loan. This especially applies to small and new businesses.
If one of these guarantors becomes critically ill or dies, then
the lenders may decide to recall the loan. Keyman Insurance can
protect you by paying off the loan and taking all the pressure
off the guarantor/guarantor's estate.
Most of the UK's top insurance companies offer Keyman Insurance
as a natural progression from their Life and Critical Illness
Insurance provisions. They can advise you further on what type
of policy would be best for you.
So, the question is, can your business really afford NOT to have
Keyman Insurance?
About the author:
Life
Insurance Quotes from
www.uk-life-insurance-coverFurther
readingWhat is Life insurance
