Why would you NOT consider this?

As a business owner you manage risks every day to keep your business running smoothly. Whether it’s installing anti-virus software on your computers or, making sure your building alarm is regularly serviced, protecting your company’s ability to make money is second nature.


In the same way, you’ve almost certainly taken out insurance to cover your business property, machinery, vehicles and more. However, many businesses fail to insure equally important risks, ones that affect their most valuable asset – their people. The death or serious illness of a business owner or key person can have a huge impact on a company’s profitability. In some cases it can even cause the business to fail completely.


Are you taking a bigger risk than you realise?


Every business is different, but take a moment to look over the following list of common problems that can easily arise should death or serious illness occur to a business owner or key person.


How many of them could you see affecting your business?


  • Interruption to the normal day-to-day running of the business.
  • The potential for lower profits until the business adjusts.
  • Interruptions to cash flow, impacting suppliers and customers.
  • Disruptions to loan repayments and overdraft arrangements with your bankers.
  • Changes in ownership and control of the business.
  • The potential to have to work with new co-owners who you haven’t chosen and who don’t know your business.


It would be surprising if you didn’t identify at least one of the problems on this list as a “major issue” that your business would have to deal with


As a business owner I would ask you to consider the following:


  • What provisions do you have to protect your profits?
  • Does the business have the ability to repay outstanding debts or director loan accounts?
  • What would the financial impact on your business be as a result of the loss of a key person?       Would there be a drop-off in income or increase in costs?
  • Who would own the business if an owner died?
  • What plans do you have in place to manage financially if the worst should happen?


By having potential solutions in place allows the business to survive.


The good news is that, like many other risks you face, there are straightforward ways to protect your business. With the help of a professional financial adviser, such as the team at Richmond House, you can find the solutions that will make the future of your business more secure.


This information is provided strictly for general consideration only. No action must be taken or refrained from it based on the contents alone. Accordingly, no responsibility can be assumed for any loss occasioned about the content hereof and any such action or inaction. Professional advice is necessary for every case.




Nigel Taylor Cert PFS, Dip FA