Since 2011 the number of start-ups businesses launched in Britain has significantly increased year-on-year. Today alone there have been 2476 new businesses launched.
Whether you’re at the beginning of your entrepreneurial journey with your business already launched, or you are just thinking about starting your own business – key person insurance should be on your list of essential things to consider.
Your own business is your baby. It requires more time and energy than you thought possible – you will live and breathe it as it is yours, and yours alone – so why would you not protect it? Should you not be able to work on the business thorough illness or injury, the chances are it would cease to exist as it is too young to lose its key person (you!).
Key person insurance acts in the same way as a life insurance, but instead of the payout going to family or a trust, it would go to the business to ensure it is financially supported during a critical time. The payout allows a buffer period for the company to recover from profit losses and allows the company to source new leadership.
Even if you took the decision to close the business, the financial payout would allow you to clear any debt and investor loans.
In a more positive light, if you’re looking to raise capital, key person insurance can act as a draw in for investors because they’ll see their investments are protected.
Key person insurance can cover not just the founder but the loss of any employee whose loss skills or expertise are essential to the success of the business.
If you would like to discuss key person insurance further contact us, we would love to answer any of your questions. The number you need is 01639 262222.