Whilst you may have private, individual life insurance or sickness or income protection insurance, what about your business?
If you are a limited company, what if you or one of your co-shareholder/directors fell long term sick or indeed died and their shares passed to loved one? Would you still be able to trade? Would you want to be a shareholder with wider family members? If you died, would you want your loved ones to have to ‘step in’ and run the business? Would they prefer existing business shareholder owners to buy your share from your loved ones? This is known as a ‘cross option agreement’ with insurance. Think of it like a business succession policy.
The same questions if you are in a partnership. Would you want your family to take over having to run the partnership? If your trading partner fell ill or passed away, would you prefer being in partnership with their loved ones or would you prefer to have funds to buy them out?
This is what directors share protection and partnership protection agreements and insurance cover protects.
Use our business protection key person calculator to give you some ideas of how much cover your may need.