Business insurance

Building your business never stops. Protecting what you’ve built so far is equally important. As businesses grow, it’s vital to ensure all that hard work isn’t lost in an instant – which is where different types of business insurance are key.

Protecting your business from disruption by injury or illness

Helping you address the financial consequences of losing a key person (like you) from your business

The right insurance can help protect your business against the loss of key personnel and the revenue they generate. It’s normal for a business to rely on several key people who they’d find it difficult to operate without. Ask yourself:

• Who are your key people? What is their value to the business in revenue?
• Could you quickly and easily replace the revenue that a key person generates? Would the business stay afloat?
• Could your remaining staff take on the additional workload? Would they stay with the business with the extra workload and pressure?

Business continuity cover can provide a monthly benefit payment to help keep your business running should you or any key staff become disabled because of illness or an accident.

Meeting loan repayments

Safeguard your business and loved ones against the financial impact of not being able to work and therefore being unable to service your loan commitments

Most businesses protect their physical assets such as their equipment, plant, stock, and buildings. Often overlooked is the human factor, which provides the skill, initiative, drive, specialist knowledge, and ingenuity to make the business a success.

Often, your ability to repay any debt is dependent on key people. If a key person dies (such as a top salesperson) or is unable to work, your business may have difficulty meeting its loan commitments. Additionally, lending institutions may need to rely on personal guarantees and supporting security. Ask yourself:

• If something happened to a key person, would your business have any difficulty meeting commitments under a loan arrangement?
• What would become of any assets associated with the loan? Would they be sold to repay the debt?
• Do you, or any other directors, have any personal assets (such as your home) linked to the business loan?

To protect yourself from risks associated with business debt, insurance is available to:

• Protect the guarantor and their assets. Proceeds can be used to repay the loan in part or in full and release the guarantor.
• Protect the business and the remaining business owners. Often banks make shareholders or directors personally responsible for the whole debt.
• Reduce the risk of company or personal insolvency.
• Meet obligations under the law.
• Reduce the risk of losing personal wealth.

Protecting your business if something happens to a shareholder or business partner

On the death of a shareholder, it's possible that the shares could pass to a person you may not know or trust, and who could have no knowledge of your business – or no interest in it! But because they now own a share in your business, they would have just as much say as your fellow shareholder before they died.

Ask yourself:

• Could your business continue if one of your partners were to die, suffer a critical illness, or be disabled and unable to work?
• What if one of your business partners were to become critically ill or die?
• Would you be forced to work with someone else?
• Who would control your business?
• Could you work with a new, possibly unknown, person if they inherited a shareholding? Would they want a say in the running of the business?
• Do you and your partners or fellow shareholders have the funds to buy out your partner or their estate?

To solve the potential issues mentioned above, typically a robust buy-sell agreement is best to be supported by insurance to an agreed value on each business owners interest, as determined by an annual valuation. For example, if a business is equally owned by two owners and is valued at $300,000, the sum insured on the life of each business owner may be recommended to be $150,000. Annual reviews will ensure the sums always reflect the market value of the business. Of course, it’s best to confirm this with an adviser.

Other business insurances

A wide range of business insurances are available. These different types of cover are continually evolving to suit the changing business environment, and include the following:

• Business asset insurance. Covers physical loss or damage to business assets, including plant, machinery, stock, contents and tools. If these assets are lost or damaged, rapid replacement or repair will enable the business to get back to generating revenue.
• Rural insurance including rural continuity. If you make your living from the land, you’ll want rural insurance that meets the unique challenges faced by farmers.
• Professional indemnity (PI) insurance. Provides essential financial protection for a wide range of professional advisers in the event a client suffers financial loss because of alleged neglect, error or omission. PI insurance will meet the cost of defending claims and any damages payable. Any person who gives advice, designs, or offers services in a professional capacity, and is seen by clients as an expert, should strongly consider PI insurance.
• Directors and officers/trustees liability insurance. Protects your staff, directors, and trustees against personal claims for “wrongful acts” in the execution of their respective roles in the company. Defence costs are usually also insured.
• Construction insurance. Covers a range of issues which can arise with building work, including house renovation and engineering projects.
• Public liability insurance. Provides indemnity for claims for compensation for personal injury or property damage for which you may be legally liable and for inadvertent actions arising out of business activities.
• Cyber insurance. Covers the reconstruction of data and loss of income as well as legal costs and expenses relating to third-party claims, such as those arising from management of personal data and the consequences of losing information.

Flexible to meet your business needs

No two businesses are the same. That’s why a ‘one size fits all’ insurance policy most often doesn’t work. Policies we have access to are from a wide range of providers and are designed to meet a wide range of needs - from simple to comprehensive levels of cover.

Expert assistance

As we’re not an insurance provider and aren’t owned by one (unlike some financial advice firms) our team of financial advisers can access all the best insurance providers across the country to ensure your business’s needs are met with the right level of cover to suit your developing needs. So that you know our advisers (in this instance often referred to as an insurance broker) are truly putting your interests first, our advisers are all paid a salary instead of commission. They also have no incentive to promote one product over another.

What next?

Managing the risks your business faces each day is a crucial role for everyone in business. But when you're busy running a business, you don't want to have to worry about whether your insurance will provide enough cover if the worst happens. So what have you got to lose by checking your situation? For a free, no obligation initial consultation with an adviser (in this case often called an insurance broker), call 0508 232 663 or leave your details below and we’ll get back to you within one working day.