Starting a business is exciting – but it will not all be plain sailing. Your business is at risk from everything from theft and legal liabilities to the loss of key people – and that’s before you start thinking about fire and flood.
At Continuum, we know how to help businesses secure the protection they need.
Check your business plan
When you were setting up your business, you probably wrote up a detailed business plan with a SWOT analysis, with details of the weaknesses as well as the strengths your business may have. Among these weaknesses should be the threats it faces.
What if your factory burned down? What if your products injured someone? What if your top salesperson had an accident on the way to a client? And what if you became unable to work through injury or illness?
Fortunately, insurance protection exists to help with all of these scenarios.
You must have employer’s liability insurance, and cover for all your vehicles. You must have up to date cover for your premises, equipment and contents. You must be able to replace key equipment, whether it is your laptop or a £500,000 machine tool.
Many other types of cover are optional, but you would be very rash not to have them.
Protecting your business itself
Heading up the ‘optional’ list of insurance is public liability cover, to protect against lawsuits if your products or service cause harm. You may need professional liability cover, to protect you against lawsuits if a client suffered loss because of a service or advice you provided them.
These types of cover may be essential conditions for working with other businesses.
But what about your key assets – yourself and your team?
Key person insurance
If your company relies heavily on one or two key people to operate, key person cover may be vital. This protects the company by providing life and critical illness cover for key people with a lump sum payout if they die or are unable to work. Key person insurance can’t replace them or their skills, but it could provide funds to keep your business running while you found someone who can.
It could help your business continue to trade should a partner die or become terminally or critically ill, but the benefits don’t stop there.
It is usual to call in loans on the death of a borrower, so the policy could repay corporate debt. Director Share Purchase Protection could provide cash to purchase shares from a deceased director’s estate, ensuring that the loss of a Director need not risk losing control of the business to a beneficiary.
Your staff may also need protection – and insurance can help you provide some valuable extras as part of their remuneration package.
Death in service is a life insurance policy for all employees that pays their dependents a lump sum equivalent to a multiple of their annual salary in the event of their death.
Other options include group income protection, providing personal income protection for multiple employees – and business health insurance. This offers private healthcare for your workers – which could get them back on their feet faster than waiting for the NHS.
Your own protection
But what about your own protection? Business owners and the self-employed don’t get sick pay. Becoming ill could mean you can’t run your business, and lead to personal finance problems.
Income protection pays out a regular monthly income if you can’t work for medical reasons. It’s a popular choice for contractors and others who don’t have the support of an employer, and there are even policies to help company directors protect their salary and dividend drawdown.
Getting the cover you need
When you are looking at business cover, you can find that some insurances are complicated to set up, and that their tax position can make expert advice essential. They may also require a great deal of shopping around to get the most competitive solution.
In the pressure of running your business, you may simply not have the time to spare. Fortunately, at Continuum we can help. As independent advisers we can search the entire market to find the most appropriate providers and assemble them into the package of cover that you need.
If you would like to find out more about protecting your business, please contact us, and get our business experts working for you.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable investment strategy, you should seek independent financial advice before embarking on any course of action.