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Business has changed over the years - that’s why we’re refreshing business protection to fit today’s small and medium sized enterprises.

Free business legal advice and tax guidance for your business protection clients

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Business Protection

How to write cover dependent on the business

Limited companies

Business type

Share and Partnership Protection

Who should be insured

Shareholder

Benefits

The remaining business owners keep control of the company (control isn’t passed onto anyone else).

The sold shares get fair value – without available capital (and a cross option agreement) the shares could be sold by the deceased owner’s family at below market value (for a quick sale).

The arrangement is tax-efficient.

How to set up the cover

Own life

Each shareholder or partner takes out a plan on their own life which is written in trust for the other business owners. Each shareholder or partner signs a cross option agreement. The remaining partners use the money paid under the claim to buy the shares.

Life of another

Where there are only two business owners, each business owner can take out a life-of-another plan for the appropriate amount of cover on the other owner's life. The owners should also sign a cross option agreement. The claim is then paid directly to the surviving business owner with the proceeds being used to purchase the deceased’s share.

Documents required

Limited liability partnerships

Business type

Share and Partnership Protection

Who should be insured

Partner or key member of staff

Benefits

The remaining business owners keep control of the company (control isn’t passed onto anyone else).

The sold shares get fair value – without available capital (and a cross option agreement) the shares could be sold by the deceased owner’s family at below market value (for a quick sale).

The arrangement is tax-efficient.

How to set up the cover

Own life

Each shareholder or partner takes out a plan on their own life which is written in trust for the other business owners. Each shareholder or partner signs a cross option agreement. The remaining partners use the money paid under the claim to buy the shares.

Life of another

Where there are only two business owners, each business owner can take out a life-of-another plan for the appropriate amount of cover on the other owner's life. The owners should also sign a cross option agreement. The claim is then paid directly to the surviving business owner with the proceeds being used to purchase the deceased’s share.

Documents required

Partnerships

Business type

Share and Partnership Protection

Who should be insured

Partner

Benefits

The remaining partner/partners keep control of the company.

How to set up the cover

Own life

Each shareholder or partner takes out a plan on their own life which is written in trust for the other business owners. Each shareholder or partner signs a cross option agreement. The remaining partners use the money paid under the claim to buy the shares.

Life of another

If there are only two business owners, each can take out a life-of-another plan on the other partner’s life. The owners also sign a cross option agreement. The claim is then paid to the surviving business owner who can buy the shares.

Documents required

Sole trader

Business type

Key Person Cover

Who should be insured

Business owner or key member of staff

Benefits

If the key person is an employee (not the business owner) the cash injection helps the company protect profits or clear existing debt.

How to set up the cover

Own life

The sole trader takes out the plan which is written in trust with their family/next of kin as the beneficiaries. If the sole trader dies, the money is paid to the beneficiaries (usually family or next of kin).

Life of another

Sole traders can also take out Key Person Cover on an employee. The sole trader takes out the policy on a ‘life-of-another’ basis. Any claim is then paid directly to the sole trader.

Documents required

Traditional or ordinary partnership

Business type

Key Person Cover

Who should be insured

Partner or key member of staff

Benefits

If a partner or key employee dies or has to take early retirement due to ill health. Key Person Cover can be used to pay off the debt or replace the profits the key person would have generated.

How to set up the cover

Own life

If the key person is a partner, the plan is on their own life, written in trust for all the partners. Any claim is then paid to the remaining business owners (through the trustees).

Life of another

If the key person is an employee, one of the partners takes out the policy on a ‘life-of-another’ basis, placed under trust for the benefit of all the partners.

Documents required

Limited company

Business type

Key Person Cover

Who should be insured

Shareholder or key member of staff

Benefits

The proceeds give the company a cash injection, which can be used to either:

How to set up the cover

Life of another

The company takes out the policy on a ‘life-of-another’. If a claim is made, the money is paid directly to the company.

Documents required

0800 032 3962

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Business Protection Specialist Team

Option 1 – New and current applications

Option 2 – Underwriting

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Options 1-3, 8.30am - 6.30pm Mon - Fri

Option 4, 9:00am - 5:00pm Mon - Fri

We may record and/or monitor calls for training and audit purposes.

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Find out more about the type of businesses we cover and the policies available.

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