Business Protection

Keyperson Insurance

Despite their utmost importance, many business owners can fail to protect their organizations from the difficulties that might arise following the premature death of a ‘Keyperson’ within their organization.

Who exactly is a Keyperson? A Keyperson is anyone who the company depends on for its continued success. They rely on their specialized skills, reputation and contacts and whose death would have serious consequences for the profitability of a company. For example, your Sales Director will have strong ties and relationships with your key clients and your Finance Director undoubtedly has a well-founded link to your suppliers and Bank.

How would your company cope with the loss of your most valuable business assets: the men and women whose talent, expertise and judgement contribute substantially to the financial health of your organization?

Partnership/Corporate Co-Director Insurance

The untimely death of a Partner in a firm can have serious financial implications for the continuing Partners. As well as the obvious upset and emotional trauma such an event causes, there are unfortunately also potential business impacts that need to be considered.

In fact, under the provisions of the Partnership Act 1890, the deceased Partner’s share of the business automatically becomes the property of their estate. It effectively becomes a debt that can be immediately called in on proof of death, unless there is a written or verbal agreement between the Partners to the contrary. The deceased’s share would normally include his or her share of retained profits and Partnership capital. What could be the financial consequences for the firm?

• The surviving Partner(s) may be unable to raise the capital required to fund the repayment of the deceased’s share of the firm to the deceased’s estate. Even where such funds can be raised by borrowing, the Partners may be unable to sustain the repayments in the long term.
• As a result, the Partnership may be dissolved, with the surviving Partner(s) now no longer being part of a previously active and productive business venture. In the event where any of these implications might arise, a heavy financial burden will fall on the shoulders of the continuing Partners.

There is however a solution available that protects your Partnership in the event of the death of one of the firm’s Partners. Partnership Insurance offers a cost-effective way:

• to put the measures in place now to safeguard the future of your firm
• to help enable its continued financial stability
• to ensure the next of kin receives a capital lump sum for the value of the deceased’s share of the firm.