The vast majority of business owners say the death or serious illness of a key business partner or employee would mean closing the business immediately.
Research carried out by Opinium with 508 business owners on behalf of Vitality showed four fifths of those polled (82%) believed the loss of a single person could shutter their business immediately.
And around a quarter of business owners said the death or serious illness of a key business partner or employee would result in the complete failure of their firm.
But the research found two thirds (69%) of business owners felt optimistic about their business’s growth and two thirds (65%) are optimistic about their personal finances over the next 12 months despite only half (48%) stating that they are optimistic about the UK economy.
Reflecting on the past year, nearly one in five (16%) said they had to close their business for periods of time, one in seven (13%) have changed their business offering, and around one in 10 (12%) have had to inject their own personal funds into their business.
Business cited rising inflation (24%), competitors (24%), followed closely by another lockdown (23%) as their biggest threats over the next 12 months.
Over the next five years, competitors (27%), inflation (19%) and rising energy prices (20%) as their biggest concerns, while competitors (23%) and inflation (18%) were also listed as top concerns over the next 15 years.
Nick Telfer, head of protection specialists at Vitality, said: “Business owners across the country have weathered a tough couple of years and it’s promising to see that they are generally feeling optimistic about the future of their businesses. However, the pandemic has taught us that that it is important to plan for the unexpected to maintain business continuity.
“With more than a third of businesses having no protection in place, there’s a massive opportunity for advisers to speak to their business owner clients to ensure they can remain confident that they have the necessary cover in place to protect themselves, their employees and their business should the worst happen.”