“Alone we can do so little, together we can do so much.”
– – Helen Keller
Your key people are essential to your business whether this is a business partner, family member or a key person of your team.
It is often not discussed or thought about but could you operate successfully without your key people?
Here are some of the key areas you should be looking at…
Do you have a plan should one of your shareholders die?
Losing a fellow shareholder is personally devastating, trying to deal with this and keeping your business running is almost impossible. Having peace of mind that your business can continue, and their family can receive the value of the shares is vital.
What would you do if you lost a key member of your team as a result of death or incapacity?
Do you have a top salesperson, a fellow director who runs a vital part of the business, or someone operationally critical that you couldn’t easily replace?
What would you do if they died or were left incapacitated for a long period of time?
Most companies haven’t planned for such events and can be catastrophic for the business if it happens.
Nothing can replace a life but the business still functions. Having something in place to protect the business is so important to help protect the people, team and future of those left behind.
The main solution is to purchase key person insurance, the benefit of this is that it is often flexible with this business.
You normally pay a fixed sum for a sum insured but, as a business protection product, you can adjust the sums insured should the covers not continue to match your circumstances.
It’s also a good idea to have key person insurance in place if you have any substantial borrowings such as a commercial mortgage or overdraft facility. This can often give you a safety net, a stress reliever needed when you have to deal with a horrendous set of circumstances.
Do you have legal cover for your key people?
ABI Definition: Directors’ and officers’ liability insurance – also known as D&O insurance – covers the cost of compensation claims made against your business’s directors and key managers (officers) for alleged wrongful acts.
Whilst this is really important, it’s equally, if not more important, to ensure your D&O (aka Management Liability policy) also covers these sections:
EPL (Employment Practices Law)
Protects against legal costs as a result of claims made by employees for wrongful dismissal.
Corporate Legal Liability
Protects against claims made against the company entity itself rather than individual directors and officers of the company.
We firmly believe that you should have all 3 covers in place to fully protect your people.