When starting a business, many people think about insuring the new assets they’re taking on – like property, stock or commercial vehicles.

But if you’re starting a business it’s also likely that you will be taking on new debt and new risks, and you need to keep the business running in order to continue to service your loans and expenses.

Starting a business can be an exciting venture, but because things don’t always go to plan, it’s important you consider having a back-up plan to get by when that happens.

There are many types of insurance that might help to protect your business. Below we’ve outlined three life insurance covers you might want to consider when you start a new business.

Talking to an expert can be a big help to find the right cover for you so you should always consult a financial adviser. 

1. Life Insurance

When you think about protecting your business, life insurance might not be the first thing that comes to mind. Life insurance can often be thought of solely as financial protection for your family, but it can protect your business too and may help your family keep it afloat if you were no longer around.

Have a think about what would happen to your business if you passed away unexpectedly or were diagnosed with a terminal illness. Would your family want or be able to keep the business open? Would it be possible to sell the business to cover any debts, or could life insurance help pay off any business loans you may have accumulated? If you’re not sure, it’s worth talking to a financial adviser about whether life insurance is a good idea.

2. Business Disability Cover

What would happen to the business’s income if you or a key employee fell ill and weren’t able to work for an extended period of time? Is there enough resource in your business to keep it running, so you can continue to draw an income? Would it be practical to hire in a replacement or a contractor, and how would you cover the cost?

If you’re not sure, talk to a financial adviser about whether Business Disability Insurance might be right for you.

Business Disability Insurance (sometimes referred to as key person cover) is designed to inject cash into your business to cover the absence (through illness or injury) of you or one of your key employees.

Business disability cover can be used to hire a contractor to cover the work that the insured person (you or a key employee) would normally be doing, or supplement some of the lost business revenue you might face if unable to work.

Alternatively, Income Protection Insurance which provides you with replacement income each month for a period of time if you’re unable to work due to illness or injury might be a better fit. This can help take the financial pressure off you and your family, so you can concentrate on your recovery and getting back to work.

A financial adviser will be able to help you decide whether Income Protection or Business Disability Insurance (or both) would be right for you.

3. Business Expenses Insurance

If you do get sick or hurt, you may still be able to work but at a lower capacity than previously. But even if you’re not making as much money as usual, your business will likely have fixed overheads that still need to be paid pay.

Business Expenses Insurance is a type of cover that can pay your business expenses for up to 12 months to help keep your business afloat.  It can help you cover regular costs like premises, utilities, equipment, salaries and other costs such as accounting, advertising and insurance.

It’s important to always talk to an expert to help find the right cover for you. You can find a financial adviser here.