Protecting your business is vital in safeguarding the livelihood of you and your family, as well as your employees.

What would happen to your business if it were to lose a vital employee (sometimes referred to as a 'key man')? Or face unexpected legal fees? We can search the whole of the market to find the best possible protection that matches your business’s specific needs.

Shareholder protection

The death of a major shareholder could have a serious impact on not only your business, but the shareholder’s family, too. Beneficiaries who have inherited shares may prefer to cash them in, while other shareholders may wish to purchase the shares, but lack the adequate funds to do so.

Shareholder protection can help with this and involves setting out how shares are to be managed if a shareholder passes away. The policy can also include critical illness and is taken out on the lives of each shareholder by either fellow shareholders, or the business. Should a shareholder die or become critically ill, pay-outs can be used to purchase the shares of the holder.

Partnership protection

Working in the same way as shareholder protection, this type of policy gives the partners of a partnership or limited liability partnership the ability to buy a deceased or critically ill partner’s share in the business.

Key person protection

Key person protection is an insurance policy that helps to safeguard a business against the financial impact of death, terminal illness or critical illness of a key person during the policy term. A key person may include any member of the business whose death could lead to financial loss for the company. This may range from recruitment and training costs, to important business contracts being lost.

The policy is written on the life of the key person, but owned and paid for by the business. With a partnership, the policy is written on an own life basis and may be placed in trust for the benefits of the other partners.

Professional indemnity insurance

For businesses that provide advice and services, claims made against you could incur costly legal fees. This may happen if a client is unhappy with the work or professional advice you have provided, and you may have to fight a claim regardless of whether you made a mistake. Should this happen, professional indemnity insurance can offer financial protection by covering legal costs.

This is a general outline of the types of protection available to businesses, but the right solution is going to depend on your specific circumstances. If you have any questions regarding business protection, please speak to one of our independent financial advisers. An AFH adviser can search the whole of the market to find the best possible solution for your business.

To learn more about our personal protection planning services, click here.

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