Last year over 10000 businesses failed in the UK. This represented a 17.5 % increase over the previous year. With things forecast to get even tougher during the coming year, senior managers and company directors should be focusing on key methods for minimising risk to their businesses.
Recent statistics show that out of the millions of UK businesses 99.9% are small to medium sized firms. Therefore it is more likely that these size of firms will be more reliant on a key individual or individuals. As such it is vitally important that Business Protection is put in place to help a company get through the death or serious illness of a partner or shareholding director.
People are important to businesses. When you’ve worked closely with someone over many years building a company, it’s all too easy to overlook the important role they play. We tend to take for granted that they’ll always be there.
The loss of a key person often occurs unexpectedly and can have a devastating impact on a company. It can cause loss of profit, interruption to cash-flow, defaults on loan repayments and changes in shareholder control. That’s not to mention the added sense of personal loss in emotional terms which can come after having enjoyed a close working relationship with someone over may years. In the current climate banks are less likely to be sympathetic to your case.
Whilst taking out keyman insurance to protect your business may not seem the most exciting thing – like launching a new product or buying new premises instead, it can help you stay in business if the worst were to happen. What business protection insurance does give you, your family and your co-owners is crucial should the worst (God forbid) happen – you have peace of mind knowing that a solution is in place before catastrophe strikes.
If you would like to find out more about Business Protection and how it works just give me shout. In the meantime, look after those around in the office today – none of us knows how precious we are until sometimes it’s too late. In the words of the old Joni Mitchell song “…You don’t know what you got till it’s gone.”
Cheers for now!
PS: In fact here’s Joni below, I hope you like her as much as I do…
{ 2 comments… read them below or add one }
Just about every small business has someone who is employed and is key to the success of that company. Therefore the loss of that key individual could mean the business unable to continune trading. What is surprising is that most companies take their staff for granted and don’t see the need for this type of insurance cover. In the USA 25% of companies have key person insurance for their employees. Clearly the USA value their companies and their staff more than we do. Maybe it’s time to change our ways?
It could be that businesses are worried enough about their future now to actually start thinking about business protection and key man insurance. I’m willing to bet that the life insurance companies announce a 100% increase (at least) in business protection policies this time next year.