Business Protection


There are in excess of five million Small Medium Enterprises (SMEs) in the UK today. Where an individual has taken the concept of an idea and built a successful business through sheer hard work and determination, investing time and money in growing the business.

 So, why risk losing it?

Mortgages121 will guide your business through the potential pitfalls that can occur, the implications if the business cannot continue and how best to position the business to ensure its survival. The primary aim of business protection is to maintain control of the business in the event a director or a shareholder dies or becomes critically ill. 

There are four main areas in Business Protection:

Ownership

Protects the business owners and their families by providing funds for a business to buy back shares in the event of the shareholder becoming critically ill or dying.

Profit

A business will protect its assets such as buildings, liability, machinery and vehicles. However, many businesses do not protect their workforce, particularly their shareholders and key people.

A business should identify:

  • Who the key decision-makers are

  • Who is generating revenue for the business

  • Who holds the strategic relationships with banks, suppliers and customers

  • The impact should these individuals leave the business or die

  • How the above would affect the profits and cash flow of the business

Debt

It is paramount that a director and their family understand the implication of a director’s loan, as personal assets are at stake.

Upon death of a director, any director’s loan provided to the company may be repayable immediately upon the death of that director. Having the appropriate Loan Protection in place protects the debt within the business.

Relevant life

A tax-efficient personal protection paid by the business that acts as a death in service benefit. The benefit is usually paid tax-free via a trust to the employees’ estate.

Other areas to consider are private medical insurance (PMI) and employee benefit schemes. The Financial Conduct Authority do not regulate employee benefits.

‘‘Gurjit at Mortgages121 took the time to understand the complicated pay and benefits structure of my employer and I am always confident in recommending him to any of my colleagues who need mortgage assistance. His experience in the industry is evident and together with his professional and approachable manner, he has become my ‘go-to’ broker!’’

-C.G