If you are a Director of a small business, life assurance is very important in two ways
First, you need to insure that should you die suddenly, your co-Directors are not left financially in the lurch – under the terms of your shareholder agreement, they may wish to purchase your shares, but how are they to raise this money at short notice? the answer is simply a life assurance policy written in trust for your co-Directors. They will then have the money to buy out your shares and your family in turn will be financially solvent. You should expect to take out life assurance on your other Directors so that you too will be left in a position to buy out their shares should they die suddenly
Secondly, you need to consider your family situation, if you are running a successful business, your family no doubt enjoys a good lifestyle, will this continue if your regular income ceases. You need to make sure that you have sufficient life cover in place for your family. It is likely that the business can pay these premiums and claim tax relief as a business expense
Most people take out life assurance to cover their mortgage but do not think beyond this – you need to be providing cover of 4 or 5 times your regular income in addition to protecting the mortgage
Nicholls Stevens will undertake a review of your own circumstances and that of the business . We will need to evaluate the value of your shareholding and your other Co-Directors , we can then advise on the level of cover which is needed and the Insurance Company which is most likely to be competitive we will need to take into consideration matters such as your state of health and whether you engage in any risky sporting activities.