KEY PERSON INSURANCE
This is a Corporate / Business life assurance policy that can compensate your Company for the financial loss due to the death, disability or the occurrence of a serious illness to an important Director / Employee / Partner / Key sales person of the business.
How does it work?
Your Company can take out Key Person Insurance at any stage of your company's lifetime.
Your Company will pay a premium on a regular basis, based on the cover that is required.
If the unexpected happens and this person dies, becomes disabled or becomes seriously ill, the policy will provide a lump sum to compensate for this event. This can be used to offset any financial losses incurred.
CORPORATE CO DIRECTOR INSURANCE
This is a Corporate / Business life assurance policy that can provide compensation to a Company if one of the directors of the firm dies, becomes disabled or becomes seriously ill. If an unfortunate event occurs, a lump sum will be released to the Company, allowing the deceased person's shares to be bought from their next-of-kin.
If one of Your Directors becomes seriously ill or dies it can create great difficulty for surviving Directors and the deceased's successor(s) alike. Corporate Co-Director Insurance gives the Company the security that there will be funds available to buy back shares should this happen.
The premiums paid on a regular basis during the terms of the policy will be dependent on a number of different factors, such as the value of the shares that the director holds, the company's turnover etc.
Life of Another Policy (Company is the policy owner, Director is the life assured)
The premiums are not admissible tax deductions.
Proceeds are tax-free.
The tax treatment of the buy back of the company’s own shares is complex (see Corporate Co-Director Insurance brochure for more information).
How does it work?
Co-Director Insurance can be taken out at any stage of your Company's lifetime. You will pay a premium on a regular basis, based on the cover that is required and the value of the shares of the Director. If the unexpected happens and the Director dies, becomes seriously ill or disabled, the policy will provide a lump sum to compensate for this event. These funds are then used to buy the deceased Directors' shares from his/her next-of-kin.
Peace of Mind - Company Directors know they will be in a position to keep control of the Company.
Ease and Choice - The deceased's successor is not obliged to become involved in the business.
Stability - The remaining Directors can retain ownership of the Company and provide continuity for the business.
Options - This insurance can also provide serious illness cover.
Why take out Co-director Insurance
Many business owners believe that it simply won’t happen to them. The chances of a partner or Director, in a small business dying or becoming seriously ill before retirement, are probably a lot higher that you might think.
The death of a Director may bring distress and grief to any organisation. As well as that, it could jeopardize the security and direction of the company. If the deceased Director was a majority stakeholder, the remaining Directors may lose control of the company if the next-of-kin were to take over.
The deceased's family may be unfamiliar with the business, and may have cash-flow problems after losing his/her income. The lack of credit to small businesses could result in some surviving business owners having insufficient funds to purchase a deceased owner’s share of the business.
Co-Director Insurance makes it possible for the Directors to buy the shares from the family, which could be the best option for all concerned.
This is a specific kind of life assurance policy that can provide compensation to a business partnership. If one of the partners dies a lump sum will be released, allowing the deceased person's share of the partnership to be bought from their next-of-kin.
The death of a partner can be an extremely distressing and traumatic experience for those involved. As well as that, this unfortunate event might jeopardize the financial security and stability of the partnership as many business partnerships are based on years of collaboration and mutual support.
Who is it for and how does it work
Partnership Insurance can be taken out by members of a business partnership of any kind. In the event of the death of one of the partners, the policy provides a lump sum which is used to purchase the deceased partner’s share of the business.
Before taking out a Partnership Insurance Policy, you are advised to seek the assistance of legal and taxation advisors. The premiums paid on a regular basis during the term of the policy will be dependent on a number of different factors, such as the value of partnership etc. If the unexpected happens and a partner dies, the policy will provide a lump sum to compensate for this event.
The remaining partners could be legally obliged to pay an immediate capital sum to the deceased's estate. This money may need to cover a range of different costs such as undrawn profits, any share of partnership fixed assets, and the balance of the deceased's capital. The partnership may be under financial pressure to provide the deceased partner's next of kin what is owed to them.