More than a third of business owners admit to having no protection in place for their firm in the event they or a key member of staff dies or suffers a severe illness.
This is according to research carried out by Opinium with 508 business owners on behalf of Vitality.
The research also found that for three in five (60%) business owners surveyed, their business is their main source of income, and for three in ten (30%), it is their only source.
However, around two fifths (43%) revealed that they do not have any form of personal cover such as income protection or serious illness (critical illness).
While three in ten (30%) business owners said they know of a business that has gone bust following the death or serious illness of an owner, key employee or business partner, two in five (38%) admitted they have never thought about what would happen to their business in a similar scenario and when asked, a quarter (25%) declared that their business would fail.
Nick Telfer, head of protection specialists at Vitality, said: “With the majority of business owners dependent on their business for financial security, there is a clear need for advisers to speak to them about business protection and what back-up plans they have in place to cope with unforeseen events.
“Many advisers will have been providing business owners with personal financial advice on family protection, mortgages, pensions and investments, but business protection cover might not yet have been part of the conversation.
“What’s more, with businesses finding themselves under increasing pressure with rising inflation and increasing cost of living, advisers can play an important role in ensuring owners have assurance that their business will be protected should a key person in the business die or suffer a serious illness.”