Business Protection Insurance | Everything you need to know
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Key Person Life Insurance
How would your business cope with the loss of a key person? We help protect your business from the death of its key people.
Shareholder Protection Insurance
The death of illness of a minor or major shareholder can lead to massive business problems. Help give shareholder dependents a fair sale price of shares and help remaining shareholders retain the business shared with these important policies.
Business Loan Insurance
Many businesses borrow to grow or invest in expensive machinery or premises. On the death of a director banks often get worried and cancel overdrafts or call in loans. Business loan insurance protects your business from this issue.
Executive Income Protection Insurance
In the event of a long term or permanent illness where a director cannot work anymore then paying their wages can become a burden on the business. Executive income protection give the company the required funds to ensure the director can still be remunerated.
Relevant Life Policy
Key Person Income Protection Insurance
Long term illness of a key person can affect both the income of a business and also in many cases the employee also needs paying. Key person income protection can cover the business for loss of income whilst the employee is not working.
Here’s How We Work
- You can either request quotes or contact us to discuss the protection you need.
- We’ll provide you with competitive and customized solutions that cater to your specific requirements.
- Once you give us the green light, we’ll take care of all the paperwork and even put the policies in trust if required.
When an individual or couple take out a mortgage then in most cases they will protect their mortgage with life insurance or life and critical illness. The same principle should apply for business that have loans, overdrafts or other type of commercial loans. However many business owners overlook and forget to cover any outstanding loans. Business loan protection is very similar to key person cover but rather than the sum assured amount covering the loss of income from the death of a key employee instead it covers outstanding debts.
Why have Business Loan Insurance?
For businesses, protecting their investments is paramount. Taking out a loan to either begin or expand a business venture brings with it a heightened level of risk, because the ability to repay the loan often rests on the performance and health of only a few key staff members. To help manage this risk, it is essential that any significant loans taken out by businesses are protected with insurance.
Insurance provides peace of mind to businesses that their investment will remain secure even if something unforeseen were to occur in regards to any important employees involved in the company’s operations. So should these employees become scarce due to critical illness or death, such policies can provide much-needed financial aid by paying an outstanding loan amount in full – something that would otherwise not be possible. As such, taking out an insurance policy when any major loans have been secured can act as both a form of protection for companies and for the individuals associated with them too.
Business loans can be critical for a business to function and grow, but without loan protection, borrowing money becomes a much riskier endeavor. Business loan protection insures the debt should an unforeseen event cause the illness or death of an owner or director who was personally responsible for it. By protecting their loan, business owners minimise their exposure and ensure that the lender is less likely to be left with unpaid debts in such scenarios.
Business loan protection helps protect against unexpected risks and stress in critical situations. With this form of protection in place, the guarantor’s estate will not be held “personally liable” if something went wrong. This offers peace of mind knowing that their personal assets won’t be affected if something happens to them or another co-owner/director. Furthermore, creditors are also secured since they know that the debt will still be repaid even if certain events occur. Loan protection offers reassurance for everyone that involvement in a commercial transaction carries less risk when compared to unprotected scenarios.
How Much Cover is Needed?
When it comes to the amount of cover you need, it is important to reflect the amount that would be needed to pay the debt or loan back in full. To ensure you have the right level of protection, there are two main types of business loan protection insurance available; level and decreasing.
Level protection is suitable if your debts stay at a consistent level over a set period, such as with an interest only mortgage. Decreasing protection allows you to address your liabilities in smaller amounts which makes more sense when responding to repayments on longer-term loans such as car finance. Business loan protection can provide significant support during a financially challenging time, allowing the continuity of trading while deferring payments on those outstanding debts. It’s vital that all businesses review their current debt levels regularly and consider the implications if one or more were suddenly unable to be paid off quickly, before selecting an appropriate level of loan protection insurance.
Options Available
When it comes to running a business, financial security is key. That’s why it is important to consider how best to manage funds for insurance policies, such as Business Loan Protection. One option might be to write the policy into a trust – but this may not always be necessary or advisable.
A trust is a separate legal entity from your own business and can be used for various purposes such as inheritance planning, or tax mitigation strategies. In some cases however, a trust would actually complicate matters if you needed to make a claim on the policy, since the payout could be held up while in the trust. Therefore, unless there is some specific reason why you need the money to be placed in trust first (for example, if there will be tax due when paying out), it makes more sense to arrange for the payout to go straight to your lender so that they can quickly settle any outstanding debt.
When a business loan is taken out, it must be done so with the understanding that there will be a responsible party for paying back the money borrowed. Business loan protection insurance is usually taken out on the individual or group of individuals responsible for repayment of the loan. The purpose of this type of insurance is to provide a level of security and assurance should something unexpected happen to one or more of the shareholders involved in the loan. This could include death, disability, or critical illness – all of which might otherwise leave the company in financial difficulty.
The business itself can act as the proposer of this kind of policy if it’s set up in a Ltd format, or each individual owner can take individual policies if within partnerships and sole traders setups. It’s important for businesses to take this kind of measures into consideration when taking out large loans as it helps protect not only the people involved but also their investments should something go wrong throughout repayment period. Making sure everyone involved understands their responsibilities and is aware that there are ways to protect their finances should adverse circumstances arise will help provide peace-of-mind during stressful times.
Here’s How We Work
- You can either request quotes or contact us to discuss the protection you need.
- We’ll provide you with competitive and customized solutions that cater to your specific requirements.
- Once you give us the green light, we’ll take care of all the paperwork and even put the policies in trust if required.
Insurance Companies we deal with
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What Our Clients Say
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Speak With an Agent
If you have any questions or would like to learn more about our business protection insurance products and services, we invite you to contact us today. You can reach us via email or by phone.
Don’t wait until it’s too late. Contact us now to learn more about how we can help you protect your business and secure your future. We look forward to hearing from you soon!