Majority of SME’s lack business protection

25 Jun 2013

Lastest research from leading protection provider Legal & General has found that the majority of small and medium sized enterprises (SMEs) have no key worker protection in place, despite the death of a business owner emerging as the most disruptive potential scenario a business can face.

An investigation into the protection habits of 500 UK businesses commissioned  by Legal & General found that death of a business owner was identified as  the most disruptive possible scenario by 43%, compared with 23% who specified  fire damage and 14% who cited critical illness.

Despite this, 57% of businesses do not have any form of protection to safeguard the  business against the risks associated with losing the owner.

The results show 12% of SMEs owners predict their business would cease trading immediately as a result of the death or critical illness of a key worker  or business owner.

A further 42% said their business would ultimately cease trading as a result  but over a longer period of time. Of these, 25% per cent would expect to cease  trading within the first year, 6% within the second year, and 11% after two  years.

Legal & General head of specialist protection Clare Harrop said: “Despite  almost half of SME owners stating death of a key worker as the most destructive  scenario to their business, it’s staggering that only 43% of businesses have  actually implemented any form of business protection to safeguard their business  in this kind of scenario.

“Cost is clearly front of mind for all businesses in the on-going financial  climate, but you never know what lies around the corner. Losing a key worker can  have a huge impact on any business, whether from the aspect of sales, turnover  or recruitment.”


Other Articles

Share This Article


Would you like more detail on how we could add value to your employee benefit proposition?

Employee Benefit Benchmarking Report 2022

Exclusively focused on UK organisations with employee headcounts of up to 1000, the data and conclusions shared in this report are directly relevant to companies of this size and profile.