Advisers are championing business protection with SMEs, according Legal & General’s ‘State of the Nation’ research.
Nearly three-quarters (73%) of SMEs which took out a business protection policy did so after seeking advice from an intermediary.
Richard Kateley, head of intermediary development at Legal & General said: “Intermediaries are already at the forefront of protecting families across the UK, but our research shows that they’re also championing the importance of protection for Britain’s small businesses.
“Almost three-quarters of SMEs that took out a business protection policy did so after receiving advice, whether that be from an accountant or financial adviser.
“SMEs that have engaged with a financial adviser are also much more likely to be prepared in the event of a key member of staff falling ill or dying.
“This could be through a business continuity plan, or an insurance policy such as share protection to help them retain control of their company if a key member of staff passed away.”
Businesses which use a financial adviser are much more likely to be prepared for a critical event such as the death of a key employee.
More than three in four SMEs that use an adviser (78%) had a business continuity plan in place.
This was also the case when it came to business protection policies as 71% of SMEs who sought advice had a policy that would enable them to buy back shares if a director passed away.
This was compared to only half (52%) of SMEs that do not use an adviser.
A fifth (20%) of SMEs who did not have any business protection had not taken out a policy because of a lack of information or because they had not been advised to do so.
Nearly two-thirds (63%) of SMEs said they were happy to be contacted by a financial adviser.
Kateley added: “Businesses often don’t think twice about insuring machines, vehicles, computers and offices, but they often forget about protecting their people – arguably their most important asset.
“As these figures show, small companies across Britain remain unaware of how a business protection policy could benefit them.
“For advisers, there is a clear opportunity to help change the status quo and ensure more SMEs – companies that are the backbone of Britain’s economy – are better prepared should they lose a critical member of staff.”