Is your business at risk if it lost a key employee?

According to research carried out on behalf of Legal & General and published in their `The Rough Guide to Business Protection' and first published in September 2016, if this happens then:
 
  • 40% of businesses cease trading within one year
  • 63% of sole traders cease to trade immediately
  • 46% of new businesses cease to trade immediately.

Who is a 'key person'?

Of course, crucial to this question is, whom would you define as a key person?  In summary form, this can be whether the loss of that person would cause significant financial loss for your business. Should that be the case, then perhaps you should consider insuring against these losses.

It may be that you are running with a tight budget and as such, you need to examine closely the people in your company that you most rely on. A lot comes down to how easily you could replace them.


How could the business be impacted?

On the other hand, the loss of a specialist might have a significant impact on your ability to trade, as other staff may not have the right skills or experience to provide the necessary cover.

If you think you might be in this position or want to discuss the issues raised in this article, please contact your normal Dentons Wealth Independent Financial Adviser. 

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