Is your company dependent on a few key people? Here’s how to protect your business in the event you lose them
Small and medium-sized businesses are often reliant on just a few key team members. It’s time to assess their value and put measures in place to protect your business in the future.
Every company has them – those critical people who are absolutely vital to the effective running of the business. They might be the owners or founders, directors or high performing salespeople. They could be business development experts whose market knowledge and contacts are crucial to the future growth of the company.
Having these key people is obviously a huge asset – but with the size of that asset there is also an associated risk of damage to your company if those team members are lost. In larger companies, that risk is often spread, simply because you have more key people in the organization. In small and medium-sized, losing one or two key people can be devastating.
How much are your key people worth to your business?
So what are the potential risks, and how should small and medium-sized businesses ensure that they have adequate protections in place?
Here are just some of the questions you should ask yourself about these key members of your team, as you begin to think about their potential value to your business:
- Will their loss have a direct or indirect impact on your profits?
- How much – and how long – would it take to recruit and train a replacement?
- Would it be possible to replace their network of contacts?
- What will the financial impact of losing this employee be? Will it impact your ability to pay back loans, or raise new finance? Have they lent your business money that you will now need to repay?
- Do they have detailed knowledge of your business processes and systems that is impossible to replace?
- How will their loss impact the confidence your customers and suppliers have in your business?
- How will their loss impact levels of goodwill towards your company?
Use keyman insurance to protect your business
Many of these elements are hard to quantify, but it’s absolutely vital to begin to think about them now. Getting a clear sense of the value of these key people to your business then allows you to look at ways of protecting that value.
One of the ways that we help small to medium-sized businesses to do this is through keyman insurance. While we’re not authorised to provide keyman insurance directly, we have a long-standing and trusted partner company who we use for our clients.
Keyman insurance provides financial support if one of the key people in your business dies, has a critical illness, or is temporarily disabled and isn’t able to work for a while.
Our recommendation is that you begin the process of identifying who these people are within your business today. Then, take steps to protect your company with the appropriate level of keyman insurance.
To find out more about how we can help you to protect your business in the event of losing key employees, take a look here
Or, to talk with one our experts about how keyman insurance can protect your business, call us on 01274 515 747 or email us at firstname.lastname@example.org.