Key Person Protection
SMART PLANNING FOR SMART BUSINESSES
People are important
There’s nothing mysterious about key person cover. Put simply, it insures a business’s key people in case they die, become critically ill or find themselves unable to work due to long-term sickness.
The success of almost all small and medium sized businesses depends on a few people who make a significant contribution. So making sure the business is covered in the event of their death or serious illness is a fundamental step.
What is key person protection?
What would happen to your business if you or another key person were unable to work due to illness or injury?
Just some of the consequences of losing a key person:
Sales could fall
New products could be delayed
It could rock the confidence of your lender, suppliers, customers and your other employees
Loans may be called in
Suppliers may demand payment up front
Customers may choose to go elsewhere
Without the leadership of you and/or your key person, your employees may decide it’s time to move on
Who are the key people?
The key person may be you, the person whose vision created the business. It could be the sales manager, whose contacts and relationships with customers make sure that sales stay on target and the business is profitable.
Often a person’s value to your business is reflected in their remuneration package. So that’s a good place to start when you’re trying to identify your key people – although this might not always be the case.
The key people might be:
With key person protection you can either insure your key people and receive a lump sum, or you can choose Key Person Income Protection which will pay you an income each month to cover the amount of profit the key person would have been bringing into the company. This will help you continue to pay the monthly loans, utility bills and running expenses.
“Half of being smart is knowing what you are dumb about.”
Ablestoke’s Registration Number is: OC367708 and Place of Registration is: England. The Company Registered Office is : Admirals Offices, Main Gate Road, The Historic Dockyard, Chatham, Kent, ME4 4TZ.
Ablestoke Financial Planning LLP is an appointed representative of Intrinsic Financial Planning Limited and Intrinsic Mortgage Planning Limited, which is authorised and regulated by the Financial Conduct Authority. Intrinsic Financial Planning Limited and Intrinsic Mortgage Planning Limited are entered on the FCA register (https://www.fca.org.uk/register/) under reference 440703 and 440718.
The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested.