Memo to myself I need Keyman Insurance
Below is a MRR and PLR article in category Finance -> subcategory Insurance.
Memo to Myself: I Need Keyman Insurance
Word Count: 547
Summary:
Keyman Insurance is one of the most overlooked protections, especially for small businesses, where it's crucial. This article emphasizes why business owners should consider this insurance.
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Article Body:
Recently, I had to drive to London. I’m not a fan of driving, and the rain and heavy traffic on the M1 made it worse. With Radio 2 playing and the heater on, I managed until I hit a six-mile queue, delaying me by an hour.
When I reached the scene, the accident was severe?"a lorry and what little was left of two cars. It made me reflect; that could have been me. I have life insurance and recently updated my will. My family would be secure, but what about my business?
We have two directors, seven employees, an overdraft, and various insurances: Public Liability, professional indemnity, vehicles, stock, even legal protection. But had I missed something?
What if it had been George in that accident? He’s been with us for five years and is our top salesman. And what if it had been my co-director, who owns 50% of the business? The repercussions would be significant.
Sales and profits would drop, and the bank might start calling about the director's guarantee on the overdraft. I’d need to buy his shares?"I certainly wouldn’t want someone else to. Hiring someone of his caliber wouldn’t be easy or cheap, adding to my stress and workload.
I didn’t want to think about it, so I switched to Radio 1.
Does this resonate with you? A staggering 95.2% of UK businesses have fewer than 10 employees, making them particularly vulnerable to the impact of a key person becoming critically ill or dying. Statistics show that 1 in 5 men suffer a critical illness before reaching retirement age. The fact it hasn’t happened yet may just mean you’ve been lucky.
For insurance companies, risk and luck are two sides of the same coin, and they offer coverage for most risks. However, they struggle with Keyman Insurance. Despite the fact that most of Britain’s 4.1 million small businesses could benefit from it, few have it. Here’s what it can do:
- Provide an income stream to the company if the key person is incapacitated, compensating for their lost contribution.
- Offer a lump sum to the business in the event of death, which could be used to pay off the overdraft or bolster cash flow.
- Supply funds for remaining shareholders to buy the shares from the original shareholder or their estate.
You’ll need to discuss these options with a Financial Adviser, but they are all insurable.
Can your business afford to take unnecessary risks?
Memo to myself: Get Keyman Insurance!
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