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Basics of Business Protection

Key Person Protection

What is key person protection?

Key Person Protection helps safeguard a business against the financial effects of death, terminal illness, or critical illness of a key person.

Who is a “Key Person”?

A key person is an employee whose continued absence would affect the profits of the business. Someone whose skills, knowledge, experience or leadership are important to its continued financial success. Examples of a key person include, but are not limited to:

  • Sales director

  • IT specialist

  • Managing Director

  • Head of product development

  • Technicians and R&D personnel

Why have key person protection?

The loss of a key person may result in reduced sales, loss of profit/turnover, wasted time, recruitment costs, the disruption of development plans or increased workloads for remaining staff.

Relevant Life Policy

What is a Relevant Life Policy?

A stand alone way for employers to provide death in service for their employees.
Directors of Limited Companies can use a relevant life policy to provide their own death in service benefits.
Tax advantages include -

  • Payments employers make aren't subject to income tax because they're not normally assessable on the employee as a benefit in kind.

  • Premiums may be treated as an allowable expense for the employer in calculating their tax liability.

  • In most cases benefits are paid free of inheritance tax - provided the benefits are payable through a discretionary trust.

Partner/Director Share Protection

What is Partner/Director Share Protection?

The loss of a partner or director may destabilise the business and can quickly lead to financial difficulties. Partner/Director Share Protection means that if the worst does happen, the remaining directors or partners can stay in control of the business.

How does it work?

In the event of a partner or director dying, falling terminally or critically ill, Partner/Director Share Protection can provide a sum of money to the remaining partner(s) or director(s). This means the policy will pay out the sum assured on the insured event occurring, which may be an amount sufficient enough to purchase the deceased or critically ill partner’s/director’s interest in the business.

Business Loan Protection

What is Business Loan Protection?

The loss of the person or people who have guaranteed a loan is particularly serious for a business. Business Loan Protection helps your business pay an outstanding overdraft, loan or commercial mortgage, should the guarantor die or become terminally or critically ill.

How does it work?

Business Loan Protection is life assurance (sometimes life assurance and critical illness cover) written on the life of an individual or individuals. When a Business Loan Protection claim is made, a sum equal to the outstanding debt could be paid to either the business or directly to the lender.

To arrange a no obligation Business Protection review, please go to the Contact page.

The information contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the uk

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