Life Cover on Expenses
This is aimed more at business owners that are looking for the most tax efficient way to provide life cover for themselves or their employees, and can in some cases reduce the total overall net cosread more
Key Person Insurance
Is your business adequately protected?
I am almost certain that most respectable business owners protect their own tangible assets such as their car and their home, and for their business, the buildings, machinery and vehicles will all be insured. But they may have key individuals within the business with skills that are absolutely vital to the success of your business that they do NOT insure.
If you, or one of your key staff died, or was diagnosed with a critical illness, the financial impact on the business could be very serious! and that is why planning to help protect the business from the financial consequences of losing key people is absolutely vital. What impact would their death have on the business? Reduced sales or turnover? Would you have difficulty in recruiting or training a replacement? Could your business afford to repay its creditors and keep trading? Could the business survive in what, for many businesses, is the harshest trading environment for many years?
There are so many solutions available in the market that can protect a business, the question is which one is appropriate to your particular circumstances? which insurance company should we use? which is the most cost effective? which contract covers the most critical illnesses? how much cover do we need? who should we insure? how much will this cost me? are the premiums to be treated as a business expense? will the benefits be taxable? what term should we select? what IS a key person? should the benefits be paid as a lump sum? can I protect a key individuals income?
Just for a moment, consider what would happen to a business if a shareholder, or a partner / director who is also a shareholder in the business dies? not only does the business lose their experience and expertise, but what happens to their shares in the business? Can the business or the remaining shareholders afford to buy their shares? Their shares may pass to someone who has no knowledge or interest in the business, or that person might gain significant control over the direction of the company and make decisions which might not be in the best interests of the remaining directors or those still working for the company.
This is an area that has become very topical, and I have actually come across a number of live examples where the absence of adequate planning has actually resulted in the business incurring huge legal bills, and even failure, not to mention the stress and heartache that it caused the families and loved ones of those affected and the families of the remaining shareholders.
Why would a company and / or its Directors and shareholders want to risk this happening to them when realistically it can cost very little in the scheme of things to potentially prevent this happening. For example the use of some very simple insurance policies, trusts and cross option agreements as one example could potentially eradicate this.
If you, or any of your associates and contacts believe that this is something they should review then simply contact us to arrange for a consultation or quotation, if you need any help, just contact us on 01482 658989 or complete our contact form and one of our Advisers will contact you directly.
Simply contact us so we can discuss your personal circumstances and the options available to you, and to arrange a consultation or quotation. Don't forget, if you need any help, contact us on 01482 658989 or complete our contact form and one of our Advisers will be in contact with you shortly.Contact Us