Business protection assurance
Most companies have a business continuity plan and take out insurance to protect their assets. However, many overlook the need to protect their most important assets, the people in their business, against death or critical illness.
There are a number of business situations in which the loss of a colleague can have severe implications for the financial health of an organisation. Life or sickness insurance can be used to mitigate the financial loss that may result. Some of the most common circumstances and areas that we advise and review protection on are:
- Death of a key employee
- Death of a business partner
- Sickness of an employee
- Sickness of a business partner
- Sickness of a self-employed sole trader
Whatever a key person does, their loss could have significant consequences for the business. For example: Loss of profit, loss of confidence from customers, the need to recruit and train a replacement, having to repay a business loan, to name a few. With adequate business protection in place will ensure peace of mind that the business will be financially secure.
What is Relevant Life Cover?
A Relevant Life policy will provide a lump sum benefit on the death of an employee. This removes the need for a company to set up a registered group life scheme, which can prove costly. Relevant life policies are primarily aimed at two groups:
- Small businesses that don’t have enough eligible employees to warrant a group life scheme.
- High-earning employees who have substantial pension funds and don’t want their death-in-service benefits to form part of their lifetime allowance.
For business owners and directors of companies. Provided the arrangement meets the criteria below, a relevant life policy has a number of advantages:
- The benefit won’t form part of the employee’s lifetime pension allowance.
- The premiums paid won’t form part of the employee’s annual allowance. The employee is still able to make full use of their annual allowance to make contributions to a registered pension scheme.
- Premiums paid by employers are not normally assessable for employer or employee National Insurance contributions.
A terminal illness benefit is available on most contracts so in the event of you being diagnosed as suffering from a terminal illness i.e. one where the expectation of life is less than twelve months the sum assured under the contract will become payable.
Talk to us about:
- Healthcare benefit
- Death in service
- Income protection
- Private dental
- Key man assurance
- Shareholder protection
- Cross Option Agreement
Mark Thompson is our expert on all types of Business Protection and Insurance and is always happy to have an initial no-strings conversation over the phone on 07393 968 194 or via email at email@example.com