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Business Protection

Business Protection

A business protection plan can be used to protect a business owner and their family against the financial impact of critical illness or death.

Providing for their family is entirely up to them – typically no employer benefits on death. They have a business that will make some provision – though this is usually overestimated. The future earnings of the business are dependent on business partners and other members of staff – though this is usually underestimated.

Business Protection can provide a lump sum which can be used to:

  • Retain control of the business in the event of a co-owner’s death
  • Ensure your family can sell their share of the business at a fair price in the event of your death
  • Reduce the financial impact of the death of a keyperson within the business

Range of Insurance Covers

Keyperson Insurance

What is this product designed for?
To compensate a company when a key employee dies or becomes seriously ill.

Why take it out?
It helps minimise the financial impact of losing key employees

Benefits:

  • If the employee dies a cash sum is paid to help maintain the business
  • Can help minimise interruption to business activity
  • Can help with bank loans where the key employee gave a personal guarantee
  • Can help pay off loans made to the company by the key employee
  • Can help provide resources to find a suitable replacement

Co-Director Insurance

What is this product designed for?
Co-Director Insurance makes funds available to buy a director’s shares from their successor when the director dies.

Who takes it out?
The directors themselves

Why take it out?
Surviving directors can lose control if a deceased director owned over 50% of the company.

The deceased successor:

  • may be unfamiliar with the business
  • Could have cash flow problems after losing the deceased’s income

Benefits:

  • Gives company directors peace of mind
  • Means the deceased’s successor does not have to become involved in the business
  • Can also cover a directors becoming seriously ill

Corporate Co-Director Insurance

What is this product designed for?
Corporate Co-Director insurance can make funds available to a company to buy a director’s shares from their successor when the director dies.

Who takes it out?
The company on behalf of its directors.

Why take it out?
The surviving directors can lose control if the deceased director owned more than 50% of the company.

The deceased successor:

  • may not be familiar with the business
  • could have cash flow problems because of losing the deceased’s income

Benefits:

  • Gives the company funds to buy back shares if a director dies
  • Means the deceased’s successor does not have to become involved in the business
  • Can also cover a directors becoming seriously ill

Partnership Insurance

What is this product designed for?
To protect the financial security of a business partnership by compensating a deceased partner’s estate for their share of the partnership.

Benefits:

  • Gives surviving partners the funds to repay the deceased partner’s estate
  • Means the deceased’s successor does not have to become involved in the business
  • Can also cover a business partner becoming seriously ill