Cover the bases for business protection

To engage effectively with potential clients in terms of business protection, you must broaden your understanding of how their businesses function. While deep technical expertise isn\'t necessary, a good understanding will allow you to position business protection effectively and help identify clients\' needs.

You should obtain surveys that identify the key concerns and preferences of business owners, which are usually protecting their firms, recruiting and retaining employees and controlling costs.

How they like to do business and whether they are reliant on trusted consultants are questions that must be addressed, along with issues such as one-stop shopping, familiarity with IT and their general expectations.

It may be possible to focus on one or two key trades and industries. If so you can get to grips with what’s happening in your clients’ worlds.

Read trade journals and proactively discuss the issues and latest developments. Ask how their business came about and what challenges they have overcome. Many founders will continue to be likely candidates for keyman cover.

Some types of business insurance such as employer liability and motor cover are compulsory. Others including public, product and professional liability are not but they all compete in cost terms with business protection. Risk management is a growing area of importance, with many businesses now maintaining risk registers covering areas such as regulatory, competitor and IT risk. Find out if keyperson, loan or share purchase risks are properly captured by these registers.

You should consider the legal structure and agreements held by firms. For example, partnerships will have agreements covering a range of matters including names, the nature of the business, roles, decision-making, profit-sharing, accounts, dismissals and dissolution.

Other key areas to focus on are life cover needs driven by double option or automatic accrual provisions and requirements to effect and maintain income protection and pension plans. Are agreements and trusts up-to-date and tax-effective? Are fellow partners and families properly looked after?

You must learn to navigate accounts including balance sheets, profit and loss statements, operating profits and cash flow. Such information will be used to calculate keyman cover but it can also identify key employees, pension provision, loan commitments and investment opportunities.

It also pays to understand firms’ taxation positions and key dates to file returns and pay tax. These are just a few of the steps you can take to broaden your knowledge of your clients’ firms and their need for business protection.