Does You Business Need Business Protection Insurance ?
Do you own a new or developing business?Do you have a key staff member your business couldn’t run without?
If the answer is yes, you need key man insurance or business protection insurance. Its as simple as that. If you have a member of staff integral to the running of your business protecting them is of upmost importance. In almost any business there will be key members of staff which make a key contribution to the company’s profitability and general running. These tend to be managing directors, technology specialists and sales managers.
These staff members not only generate a large percentage of the company’s profits, but they may hold vital knowledge about the running of the business. People who in effect could cause the collapse of the business should anything happen to them. The collapse may not be instantaneous, but without their knowledge or expertise the business may be left vulnerable to competitors. If you’re reading this and are thinking of certain employees/colleagues then you almost certainly need key man insurance.
One of the main things you should consider whilst looking at taking out key man insurance is the financial security of your business. For example would the company have sufficient funds for the replacement and training of new staff members? To replace an integral member of staff it is almost guaranteed to be an expensive and drawn out process, finding someone with the same experience and knowledge wouldn’t be easy. Having a lump sum available to cover the costs of wages and training can take away a large strain from the business, especially at a vulnerable time. Having a lump sum available also means the business will not struggle to find finances for expansion or venue changes. Insuring a key person on your team is a sensible decision for the business. It just makes sense.
It allows the business to continue developing in difficult circumstances, without holding progress that the company may have been making, or completely stopping it in its tracks. It may feel like a huge step backwards whilst adding stress and strain onto the business. Key man insurance insures the business remains financially protected from any losses it could occur and shields the business from the losses of finding and training replacement staff.
Another reason to think about whether your business needs key man insurance is if you have a business loan. The business itself may be able to survive the loss of a key person, but would it be able to cope financially? If there are two guarantors on a business loan would one be left responsible? Would the company have difficulty meeting loan repayments which in effect would hurt the business?
These are important questions that need to be looked at and thought about at any point in the business, however big or small. If you are considering taking out a business loan it may be worth checking with the loan organisation as many are now making key man insurance a condition of their terms. It guarantees that there will be no difficulty in repayments as a lump sum is paid out on death or critical illness of the key person insured. Overall key man insurance is essential within a business.
If your business needs key man insurance or you want more information or have any questions visit key man insurance business Protection Adviser today. They will search the market for you to find the best business protection available for the lowest price. The service is completely free and they can give you the help and advice you may need to get the best plan for your business.