Business Protection
The business protection market can be a complex and daunting landscape for any business owner to navigate. With so many different products and options available, it can be difficult to know where to start. This is where our advisers come in - they have the knowledge and expertise to help you navigate this complicated market and find the best solution for your business.
Our advisers take the time to understand your business and its unique needs. They will work with you to identify potential risks and recommend the most suitable products to protect your business. Whether you need to protect against the loss of a key person, partner, member or shareholding director, or want to cover business loans, our advisers can help you find the right solution.
Helping a business mitigate risks
The top 3 risks for a business
52%
Death of an owner or key employee
38%
Major contract loss
35%
Owner or key employee suffering critical illness
L&G Business Protection State of the Nation’s SMEs Report 2021
Shareholder Protection
Protect against losing control of your business, and make sure you get fair value for selling your share of the business if you are too ill to work. If one of the owners of a business dies or is diagnosed with a critical illness, this can lead to a period of uncertainty, uncertainty for the other owners over who will replace them. Will any replacement be able to fill their shoes or will they be able to force a sale or winding up of the business?
Uncertainty for the family of the owner who has died or been diagnosed with a critical illness - will they be able to receive a fair value for the share of the business? Ownership protection removes this uncertainty by providing a lump sum to compensate the family for loss of the share of an owner who has died or suffered a critical illness.This allows the other owners to maintain the ownership of the business between them. It also allows the family to receive a fair value for the share without delay.
Key Person
Protect a loss in profits or the cost of having to replace an important employee whose long term absence could damage your business in a number of ways. A key person is any employee (including owners/managers) whose loss from the business through death or illness will have a significant effect on the financial position of the business.
Key Person Protection allows you to protect your business from the financial effects of losing a key person. It can be arranged to provide either a regular income if the key person is unable to work because of an illness or accident, or a lump sum if they die or are diagnosed with a critical illness.
Key Person cover helps to protect against the following business risks:
- Protect profits
- Loss of profits during business disruption
- Protect debts
- Paying back a business overdraft
- Covering salaries, dividends or loaned money through a director’s loan account
- Recruitment costs
- Pay penalties for non-delivery or late delivery of goods and services
- Being unable to repay a loan
- Paying an account upfront
Executive Income Protection
- Designed for small and medium businesses (SMEs) and covers up to 80% of the employee’s earnings plus the employer's National Insurance and pension contributions (maximum levels apply).
- The monthly benefit pays out to the employer and is passed on to the employee via PAYE to cover the cost of sick pay, so protecting the business finances.
- Usually counts as a tax-deductible expense for the employer.
- More tax efficient than personal Income Protection cover for the employee.
Relevant Life Cover
A Relevant Life Policy is a death in service arrangement, which provides a lump sum on the death of an employee within the term of the plan in a tax efficient manner.The benefit is payable to the employee’s dependants through an appropriate Discretionary Trust.
Relevant Life Policies are an alternative to group life schemes for small businesses that don’t have enough eligible employees to warrant a group life scheme.
Loan Protection
Protect your business by having a plan in place to repay a loan in the event of the loss of a key person. Many businesses borrow to fund their future plans.
Loan Protection simply provides the business with a lump sum allowing them to repay their borrowing if someone key to their business dies or is diagnosed with a critical illness.
Protecting a business loan is important because it ensures that the loan is repaid in the event of unforeseen circumstances, such as business disruptions or unexpected expenses, which could otherwise result in default and financial hardship for the business.
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