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Business Protection Insurance
- Greenshoots Financial
- Feb 20
- 2 min read
Is Your Business Protected If You Lost a Key Person?
Most business owners know they need insurance. Yet industry research suggests that over half of UK businesses may not hold sufficient key person protection cover. That is a significant gap - and one that could have serious consequences.
A key person is any individual whose death or long-term absence due to critical illness would create a material financial or operational impact on the business. That could be a founder, a director, a specialist, or anyone whose skills or relationships are central to how the business functions.
What could it mean in practice?
Industry figures indicate that a large proportion of sole traders would need to cease trading immediately if they lost a key person. For small and medium-sized businesses, research suggests that a significant number would close within a year under the same circumstances. While these figures vary by source and sector, the underlying message is consistent - most businesses are more vulnerable than their owners realise.
Business protection can help address several risks in one place. Proceeds from a policy may be used to fund the recruitment and replacement of a key employee, to buy out shares from a deceased partner's or director's estate, or to help manage business debt. The right structure will depend on your circumstances.
What cover is available?
Business protection life policies typically offer a choice between life cover only, or life cover combined with critical illness cover. Additional options may be available depending on your needs and the insurer. As with all insurance, terms, limitations and exclusions apply, and the level of cover should be reviewed regularly to reflect changes in your business.
A policy may not pay out in all circumstances. The premiums you pay and the sum assured should be assessed carefully with a qualified adviser to ensure the cover is appropriate and represents fair value for your business.
Talk to us
If you are unsure whether your current cover is sufficient, or if you have no business protection in place at all, we are here to help. We can review your situation, explain your options clearly, and recommend cover that suits your business - without any obligation.
Get in touch by phone, email or via our website to arrange a conversation at a time that suits you.
Greenshoots Financial Ltd is authorised and regulated by the Financial Conduct Authority. This article is for information purposes only and does not constitute personal financial advice.
