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Business protection: It’s never just about the business

23/10/2025

Marcus Primhak, National Account Manager

When we think about business protection it’s easy to view it as something separate from personal protection. After all, while the products we use are familiar – Life Cover, Critical Illness Cover and Income Protection – the environment in which we give advice can be very different.

The conversations we have in the boardroom often feel a world away from those we have in the living room. But that distinction can sometimes cause us to miss a vital opportunity: to protect not just a business, but the families and livelihoods that depend on it. 

Business protection is family protection

“As with much of the cover we put in place, the starting point for business protection is often not the business itself, but the family behind it.”
Marcus PrimhakNational Account Manager
Info graphic Showing: 77% of UK businesses with fewer than 9 employees are family owned.

Research from 2023 found that 77% of businesses with fewer than 9 employees are family owned [1]. In many of these businesses, a matriarch or patriarch is the driving force – the one “active” in the day-to-day running of the company. Other family members might be involved to a lesser extent, or sometimes not at all.

This means that, should the worst happen, there may be no experienced co-shareholder ready to take the reins. In those circumstances, business protection is not just about securing profits or ownership – it’s about protecting the family’s future.

The personal impact of losing a business owner

The protection advice we give to families in these situations should make one message clear: their financial wellbeing is built on the continued success of the business.

Without proper planning, the death or critical illness of the key family member can quickly lead to financial and emotional hardship. Beyond the financial loss, the absence of forethought can bring enormous pressure and upheaval.

 

“On the day of my father’s funeral, the family had to go to his office and break into the locked bottom right drawer of his desk. He always said if something happened to him, that was where the important stuff was. You don’t know how many times I later sat at that same desk crying, wishing my father had spent an hour with me explaining what it all meant”
Family successor who was forced to drop out of university after her father’s sudden death [2].

For smaller, family-owned businesses, Shareholder & Partnership Protection may not always be necessary. But protecting key people and planning for worst-case scenarios can make a huge difference. It can help the family feel confident that, whatever happens, their livelihood is secure.

Supporting employees through uncertainty

The impact of losing a business owner or key employee doesn’t only affect the family – it can ripple through the entire workforce.

At the start of 2025, small and medium-sized enterprises (SMEs) employed around 16.9 million people [3]. This means that more than 3 in every 5 people employed in the UK private sector are reliant on the continued success of a business where, as we know, critical talent and ownership capital are often concentrated in a small number of individuals.

If a business owner or key employee passes away or becomes critically ill, it can create a sudden vacuum that disrupts operations, affects performance, and deeply unsettles employees. In close-knit SMEs, where staff often have a closer understanding of the financial and operational mechanics of the business, that uncertainty can start a further bleed of talent as employees start to look for opportunities elsewhere in an effort to safeguard their own incomes.

A well-planned, well-communicated protection strategy can change that. Being able to tell staff that, thanks to a Key Person Cover policy, the company has sufficient resources to keep the lights on, pay wages, adapt to the new situation and secure everyone’s future makes the world of difference.

It’s about more than the business

By considering how the loss of a business owner or key employee can impact the financial security of both their own family and other employees, we can start to understand why business protection is never just about the business and begin to position our recommendations accordingly.

At LV= we’re proud to be able to support advisers through every step of their business protection journey with tools, training and business development ideas to ensure they can protect as many clients’ businesses as possible.

Business Protection

Our Business Protection comes with a range of options. They’re flexible and help you offer the best solution to your client.

A guide to Business Protection

Tools and calculators

When it comes to recommending business protection, there are many factors for you to consider. To streamline this process, we’ve developed a range of calculators.

Use our tools and calculators

Dedicated support

Your account manager can provide dedicated business protection support including training and case consultancy.

Find your LV= Account Manager

[1] Familybusiness.org

[2] Next-Generation Entrepreneurs and Succession: An Exploratory Study of Modes and Means of Managing Social Capital. Lloyd Steier, 2001.

[3] Business population estimates for the UK and regions 2025