Partnership/Keyperson Insurance

By: DHKN Life & Wealth  28/04/2015
Keywords: Partnership Insurance, Keyman Insurance

What is Partnership Insurance? Like everyone you need to protect yourself and your family against the financial impact of serious illness or death. However, as a business owner your protection needs are different. Your business will provide some financial security, however you probably aren’t entitled to employee benefits. In addition, the future earnings of the business is dependant on others. As a business owner you need to consider what would happen to your share of the business if you died prematurely and the financial impact that could have on your family. You also need to consider what would happen to the business if a co-owner died prematurely. What would happen to your family if you died prematurely? ◾Would they take over your share of the business? ◾Would the remaining shareholders have the funds needed to buy your share back from your family? ◾Has this plan been formalised? What would happen to your business if a co-owner died prematurely? ◾Would you maintain control of the business? ◾Do you have the funds to buy back their share of the business from their family? ◾Has this plan been formalised? What is Keyperson Insurance? Keyperson Insurance financially protects the company in the event of a death of a Key Director or Employee. The following questions will assist you in establishing whether Keyperson Protection is relevant to your business: 1.Does your company have any bank loans outstanding for which a director or shareholder has given a personal guarantee? 2.Does your company have any Directors Loans, which would be repayable on demand to the director’s estate on death? 3.Does your company have any key employees or directors on whom the company depends financially for their particular expertise and/or contacts? If you answer Yes to any of the above, then you need to consider insuring the Key Person. DHKN Life & Wealth provide a specialist service in the area of Keyman Insurance. Failure to structure this cover correctly could result in taxation problems in the event of a claim.

Keywords: Keyman Insurance, Partnership Insurance

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