The setting up and day-to-day running of a business is a time-consuming task for those involved. Whilst businesses are generally quick to insure themselves against the most common operational risks, it is often protecting the business’s most valuable asset, its people, that is left in the ‘important but will look at later’ pile.
Research has uncovered that over half of business owners (of UK small and medium-sized enterprises) believe that their businesses would dissolve or close within a year if a shareholding director or key employee were unavailable due to critical illness or death.
Our independent review of the requirements of your business and succession plans can help ensure that commonly encountered risks have a minimal impact on the business’s profitability or ownership structure if they occur.
From our experience of working with entrepreneurs, we understand that business owners and directors can often have complex requirements across various areas of their operation, which is where we have a reputation for adding value.
Many businesses have placed value on our planning expertise in advising on complex operational requirements in this area. In addition, they have found that we are adept at working with their legal and accountancy advisers, providing co-ordinated strategies that play a major role in the continuing progress and success of enterprises, large and small. Areas we can also help include helping prepare a business lasting power of attorney and ensuring that you have the relevant life cover.
If a business owner were unavailable due to serious illness or death, not only would it come as a devastating blow to that shareholder’s family, but it could also have major implications for the future of the business and its ownership structure.
Shareholder protection policies provide vital finance in these circumstances for the business, offering the remaining directors the ability to buy out and retain full control of their business. In addition, this also provides funds for the family to help lessen the financial impact of their dramatic change of circumstances.
Coordination between all professional advisers is key to ensuring the optimum outcome for all; we have extensive experience in working with the business owner, and their accountant and legal advisers to ensure a smooth transition at is an extremely disruptive time.
The loss of a key person, who contributes significantly to the growth and success of a business, could also leave the business without vital skills and knowledge. This could have significant financial consequences, such as the loss of valuable contacts resulting in subsequent loss of profit and a downturn in business performance.
Key person cover can give a business the much-needed breathing space during a time of potential instability. There are a huge range of key person policies available from different insurers. We have extensive experience in setting this type of protection up for crucial members of a business team and those who bring specialist knowledge and expertise to the business. Depending on the reason for setting up this type of protection, the premiums could be tax-deductible. Again, we would work alongside your accountant to provide commentary on this.
It is easy for busy entrepreneurs to overlook the need to plan and organise their own finances, as well as those of their business. We understand the particular needs of business owners, directors and their families and provide advice on investments, pensions, retirement and tax planning.
We are known for our holistic approach to our clients’ financial needs and attach huge importance to ensuring that we address both their business and personal financial needs, now and for the future.
If you would like to discuss any of the above, please contact your usual Partners Wealth Management adviser, email us or call us on 020 7444 4030.
For further information on how we can help you build and protect your wealth, please contact us.