This document discusses how life insurance can help protect businesses from losses that occur due to the death or critical illness of important employees or business owners. It provides examples of how a business suffered when the top salesman Dave died and was unable to be quickly replaced, and when business owner Sue died and her partner wanted to cash out rather than remain involved in the business. It notes that around 1 in 3 male business owners and 1 in 4 female business owners will suffer a critical illness or die before age 65. Taking out life insurance that pays out to the business can replace lost profits and allow the purchase of shares from a deceased owner's partner so the business can continue as before.

1. Protecting your business Proactive Medical & Life is an Appointed Representative of Healthnet Services Ltd. Healthnet Services Ltd are authorised and regulated by the Financial Services Authority.

2. Protecting your business ? ?    What do you protect? Property Liability Vehicles Profits Ownership Today we will look at why and how you should protect the profits and ownership of your company

3. Think about as we go through today Your current profit levels Your home/work balance How the situations we discuss could change this balance How these changes would affect your lifestyle and financial security Work Home

4. Meet Dave Dave is the top salesman in the company. He is responsible for bringing in 50% of the company’s revenue. He holds valuable relationships with all of the company’s customers.

5. What would be the impact of Dave dying? Profits drop as not so many sales are made Relationships with key customers suffer and they start looking elsewhere to buy Dave’s replacement’s salary is higher as they had to be brought in at short notice Recovery is slow while Dave’s replacement get up to speed The bank stops the overdraft facility because profits are falling Management team has to spend more time in the business

6. What if a key person in your business died? How many Dave’s do you have in your business? Who could you really not do without? If they were not at work, how would your business suffer? What would happen to the balance in your life? Work Home

7. The solution When Dave died, the profits dropped The Company takes life cover out on Dave…and pays for it Life cover paid out on Dave’s death and replaced the lost profit Profit £

8. Meet the board Sue, Bill and Jo own an IT consultancy company Each has invested significant time and money in the business and the value of their share in it is continuing to grow If one of them were to die, the others could carry on, although at a reduced turnover Their spouses/partners have no interest in the business and no skills to contribute to the business

9. What was the impact when Sue died? Sue’s partner wanted to sell Sue’s share of the business – and as neither Bill or Jo could afford to buy them out, their share was offered to a third party (if one could be found). Sue’s partner started attending board meetings and was pushing for higher dividends to be paid out to increase his income At the same time as dealing with Sue’s partner Bill and Jo had to put more time into the business to cover the work Sue would have done Plus, many of the same issues we saw with Dave

10. What if you or one of your co-business owners died? How many of your co-owners’ partners would need money rather than the share of the business? Could you afford to buy their share of the business? Would your co-owners’ partners want to be part of the business? Do you want them to be? What would happen to the balance in your, or your partner’s, life? Work Home

11. The solution SUE SUE DIES LIFE COVER ON SUE IN TRUST TO BILL & JO SHARES SUE’S PARTNER SUE’S PARTNER ASKS BILL & JO TO BUY SUE’S SHARE OR BILL & JO ASK SUE’S PARTNER TO SELL THROUGH A SUITABLE AGREEMENT LIFE COVER PAID TO TRUSTEES TRUSTEES PAY CASH TO BILL & JO BILL & JO BUY SUE’S SHARE

12. It won’t happen to me…….. A business man has a chance of suffering a critical illness or dying before his 65th birthday 1 in 3 Source: http://www.ghfmsl.co.uk/insurance_life.php A business woman has a chance of suffering a critical illness or dying before her 65th birthday 1 in 4

13. Do you want to do something about it? Please feel free to talk to me after the session I will call you to discuss your specific requirements over the next few days This presentation is based on PROACTIVE MEDICAL & LIFE interpretation of the law and HM Revenue & Customs practice as at 16 th December . While this interpretation is believed to be correct, PROACTIVE MEDICAL & LIFE can give no guarantee in this respect.