UK Insurance Index Business Articles
search advanced search

Home >> Business Insurance Articles


How to Protect Your Business Against the Loss of a Key Employee?

Article by Simon Christopher
Article added: 4/4/2005 - Last updated: -
Rating: 0.00 (0 votes)


Business Protection gives your business financial help if the staff covered are affected by death, terminal or critical illness, or permanent disability during a benefit term.

Every business has certain key personnel who are vital to its success and prosperity. It might be the sales director, or it might be a specialist craftsman. Every business is different, but most directors will know which staff members are vital to prosperity.

However, the damage caused by the prolonged absence of someone on whom a large part of the business depends is often underestimated or not even considered.

Key Person Insurance
Key person protection can cover one or two nominated individuals, who can be a partner or an employee. If they die or are diagnosed with a terminal or critical illness, the policy will pay a lump sum either on death or shortly after the diagnosis of a disease. Some policies will pay a regular income if they are absent from work for a long time.

Unforeseen Events
If a partner in a business dies, there may be other problems. Apart from their loss to everyday business activity, there may be imperative reasons to buy out their shareholding so that it does not pass to outside investors who do not share the vision of the company's future. Such unforeseen events can lead to crises, reduced revenues and even, in some cases, business collapse.

Protect Your Business
Business Protection is designed to protect your business in circumstances like these. You can choose the benefits you need and tailor them with additional features, such as waiver of premium during periods of incapacity, the choice of fixed or renewable terms and having index-linked benefits so that they stay in line with increases in inflation. In addition, you can change your benefits as your business needs change.

Business Protection covers the individual people you nominate in your policy or policies. If one of these people dies, is diagnosed with a terminal or critical illness the benefits are paid as follows:

For life cover and critical illness protection, a lump sum is paid on death or after diagnosis of one of the specified illness.

For business loan protection, a lump sum is also paid. However, this reduces to nil over the course of the policy (so, for a policy with benefits of £50,000 over 10 years, the benefit payable would reduce by £5,000 each year).

What Can Benefits Be Used For?
Funds provided by business protection insurance policies can be used to:

  • fund a permanent or temporary replacement
  • tide the business over a period of reduced activity
  • contribute to medical care to speed recovery
  • repay an outstanding loan


PLEASE NOTE: The guidance published in this business insurance article is for information only and does not constitute financial advice or a recommendation of any particular product or company. If you are in any doubt please consult an independent insurance adviser. A database of advisers in your area is available at www.unbiased.co.uk

Copyright UK Insurance Index http://www.uk-insurance-index.co.uk. All rights reserved.


comments about this business insurance article

Comments About this Article:

 Add a Comment


share this business insurance article

Share this Article:



rate this business insurance article

Rate this Article:


Please rate this article between 0 and 5
with 5 being top.
All ratings received for this article.

all categories ALL CATEGORIES
A-Z Categories

popular categories POPULAR CATEGORIES
Car Insurance
Home Insurance
Life Cover
Mobile Phone Cover
Pet Insurance
Travel Insurance

directory categories DIRECTORY CATEGORIES
Business
Event
Health
Home & Property
Insurance Brokers
Life & Protection
Marine
Motor
Non UK Insurers
Pet & Animal
Personal Possessions
Specialist Cover
Sport
Travel

review categories REVIEW CATEGORIES
Business
Car & Motor
Health
Home
Insurance Companies
Life Cover
Motorcycle
Pet & Animal
Possessions
Sport
Travel

article categories ARTICLE CATEGORIES
Business
Car & Motor
General
Health
Home & Property
Insurance Awards
Insurance Guides
Life Cover
Pet & Animal
Travel

news categories NEWS CATEGORIES
Business News
Car and Motor News
General News
Health News
Home & Property News
Life Cover News
Pet and Animal News
Travel News

FEATURED SITES
Direct Line Business Insurance
Direct Line Business Insurance
Direct Line offers a range of commercial insurance products and guarantees to beat your renewal premium (terms apply).

Hiscox Business Insurance
Hiscox
Hiscox offers cover suited to the specific risks your industry may face. Create your own tailor-made policy online in minutes.

latest listings LATEST LISTINGS
AXA Business Insurance - buy online and save 10%
Quote 123
Constructaquote.com Business Insurance Comparisons
Autonet Business Insurance
ONE Business Insurance Solutions

latest reviews LATEST REVIEWS
Construct a Quote Van Insurance
GNU Travel Insurance
DOMESTIC GENERAL TV Insurance
Protect Your bubble Gadget Insurance
Constructaquote.com Van Insurance - Goods in Transit - Tradesman

latest articles LATEST ARTICLES
Common questions about public liability insurance
Do You Need Business Insurance if You Work From Home?
How to Protect Your Business Against the Loss of a Key Employee?
How Does Business Life Insurance Work?



Home | Privacy & Cookies | Terms of Use | Contact | Submit Site | Advertisers

Page protected, do not copy

This website uses cookies to ensure a reliable browsing experience. If you continue to use this website you are consenting to us using cookies in this way. To find out what cookies are, which ones we use and why we use them please click here.

Copyright © 2017 UK Insurance Index. All rights reserved.
All directory listings, articles and reviews are provided as information only and do not constitute advice or a recommendation of any product or provider. If you use these insurers, we take no responsibility and give no guarantees, warranties or representations, implied or otherwise, for the content or accuracy of these third-party web sites or companies. If you have any doubts you should consult an authorised independent financial adviser for advice based upon your individual needs and circumstances. A database of advisers in your area is available at www.unbiased.co.uk.