According to Scottish Provident's Business Protection report, 21% of business owners believe that there is a fairly high chance (at least one in three) of losing one of their key employees to a serious illness before retirement which will keep them off work for six months or more, showing that the threat of losing a key worker is a worry for many firms.
Over half stated that the death of a key employee would have a very severe or serious impact on their company, while a similar number stated that there would be severe problems for the business if a key employee contracted a serious illness that put them out of work for six months or more.
In spite of this, just one in four businesses have key employee or key person insurance in place. A slightly greater number (27%) hold partner/shareholder protection products, while just over one in five (21%) have a form of business loan protection.
Susan Barclay at Scottish Provident says, "While small businesses are showing concern about losing a key worker to a critical illness or death, precious few seem to be acting to safeguard their company in that eventuality. The statistics are frightening - in a business with four key male employees, there is a 29% chance one will die before retirement and a 68% chance that one will have a critical illness."