Business Solutions
Many people have a personal life insurance policy, but many
directors or partners often don't realise the value of business
protection until it's too late.
What is business protection?
Arranging business protection is often thought to be lengthy
and complicated. But actually, the principles are similar to any
other type of protection.
The most significant differences are:
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Business protection generally incorporates
higher sums assured. |
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A claim may be paid to a business, not a
family member. |
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Business protection could help client owned businesses
continue to trade in the event of a key person, partner or
director falling terminally or critically ill or dying.
Types of protection
We offer four main kinds of business protection:
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 What is Key Person Protection?
Key Person Protection helps safeguard a business against the
financial effects of death, terminal illness, or critical illness
of a key person.
The loss of a key person may result in reduced sales, loss
of profit/turnover, wasted time, recruitment costs, the disruption
of development plans or increased workloads for remaining staff.
Who is a 'key person'?
A key person is an employee whose continued absence would
affect the profits of the business. Someone whose skills,
knowledge, experience or leadership are important to its continued
financial success. Examples of a key person include, but are not
limited to:
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Sales director |
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IT specialist |
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Managing director |
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Head of product development |
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Technicians and R&D personnel |
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Partner/Director share protection
What is Partner/Director Share Protection?
The loss of a partner or director may destabilise the business
and can quickly lead to financial difficulties.
Partner/Director Share Protection means if the worst does
happen, the remaining directors or partners can stay in control of
the business.
How does it work?
In the event of a partner or director dying, falling terminally
or critically ill, Partner/Director Share Protection can provide a
sum of money to the remaining partner(s) or director(s). This
means that in the event of a valid claim the policy could pay out
an amount sufficient to purchase the deceased or critically ill
partners/directors interest in the business. |
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Business loan protection
What is Business Loan Protection?
The loss of the person or people who have guaranteed a loan is
particularly serious for a business. Business Loan Protection
helps your client pay an outstanding overdraft, loan or commercial
mortgage, should the guarantor die or become terminally or
critically ill.
How does it work?
Business Loan Protection is life assurance (sometimes life
assurance and critical illness cover) written on the life of an
individual or individuals. When a valid Business Loan Protection
claim is made, a sum equal to the outstanding debt could be paid
to either the business or directly to the lender. |
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Relevant Life Policy
If you're a company director and you have life
assurance in place to protect your family, you could be paying
more tax than you need to.
Relevant life policies are a way of providing death in
service benefits on an individual basis no matter how small
your business is.
What are the benefits?
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Although the company pays the premiums,
they are not normally assessable to income
tax on the employee as a benefit in kind.
This can be a significant saving,
particularly for a higher rate taxpayer. |
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Unlike a registered group scheme, the
benefit will not form part of the employee's
annual or lifetime pension allowance. |
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These payments may be treated as an
allowable expense for the employer in
calculating their tax liability, as long as
the local inspector of taxes is satisfied
they qualify under the 'wholly and
exclusively' rules. |
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In most cases the benefits are paid free of inheritance
tax - provided the benefits are payable through a discretionary
trust.
Contact us for further information |
