When starting up or running a small business, there are many things to work on to ensure that your company is successful. From where to operate from, which can be made simple by Flexspace, to how to realise new customers. Then there’s staffing, invoicing and everything else that goes into it. These day-to-day challenges can often distract from some more significant concerns. Like your health.
It is normally the case that your employees have more protection and cover than you do. If they are absent then there’s normally a way to cover them. Even if the cover is you. However, what about you or any of your co-Directors? What would happen if you suffered a long-term illness or absence from the office. How would your business cope? This is where Key person insurance helps.
Key person insurance is in simplified terms life insurance on key persons within a business. This could be the owner of the business, the founder or possibly a key employee. Generally it is one whose non-attendance would have a significant negative impact on the company and is not easily replaced.
Any firm is able to set up key person insurance to aid when a key staff member in the company becomes critically ill or dies. This insurance policy can also assist in circumstances such as when the key person in the business has either been in an accident or hospital and is unable to pay for their workspace rent. Rent arrears can be a hassle which, can under certain conditions, be easily avoided by taking out the right policy.
Staff in any company are the asset to a business, losing an important person in any firm may put a small business in jeopardy. Even in larger companies, there may be certain salespeople or technically skilled staff members who are virtually irreplaceable. With this insurance, you can maintain continuity, ensuring a business is able to operate financially and constructively even if it loses an important member of the team.
A key person insurance policy can also provide a pay-out in the event of a critical illness. An example of this could be the business loan protection, which will give lenders reassurance that the key person insurance will cover debt repayments.
At Flexspace we hope that clients never need to use key person insurance, but it is a fact of life that these kinds of situations occur. Which is why we recommend that you consider making your future business more secure and consider key person insurance.
Talk to your financial advisor if you want to explore this form of cover.