Matt Thomas explains how different products can help with business continuity planning.
➢ Key man/ key person insurance
Designed to protect the profit or income of a business that is generated by key employees or directors. Should these key people suffer a serious illness or pass away funds will be available to provide training to existing employees, recruit & train new staff or simply ensure the company can meet it’s financial obligations until the key person can return to work.
➢ Shareholders protection
In the event that a shareholder passes away this product will provide the surviving shareholders with the funds to purchase the deceased’s shares from their family/estate without borrowing against business or personal assets. This protection can provide peace of mind to both parties ensuring the deceased’s estate benefits from the value of their shares and the surviving partners retain control of their business.
➢ Life cover
Available to any employee of a limited company this product is typically taken up by directors in place of their personal life insurance products as it is much more tax efficient. Relevant life cover is personal life insurance paid for by the company and is exempt from income tax, national insurance and corporation tax, saving a higher rate ta payer 58% on their monthly premiums.
➢ Death in service benefit
Underwritten on a group basis and paid for by the business, this product is an employee benefit typically paying out 3-5 times the employees salary should they pass away during their employment term. The lump sum can be paid to any nominated beneficiary including the company or the policy holders family.
➢ Private Medical Insurance
Often thought of as an employee benefit, this product provides employees of a business with access to Private Medical Insurance. Not only supporting staff retention by providing an additional benefit, this product can also ensure staff have regular health checks and return to work quicker after an accident or injury. Additional benefits such as discounted gym membership and cinema tickets are also available.