Key person insurance for businesses in Aylesford and beyond
At Yomo Finance, we understand the critical role that key individuals play in the success and continuity of a business. Losing a key person, whether it's a founder, executive, or highly skilled employee, can have a devastating impact on operations, revenue, and overall business performance. That's why we offer comprehensive Key Person Insurance solutions to help protect your business from the financial consequences of such a loss. Contact us today to find the right deal for you.
What is key person insurance?
Key person insurance, also known as key man Insurance or key employee insurance, is a type of life insurance policy that a business takes out on the life of a key individual within the organization. In the event of the key person's death or terminal illness, the policy pays out a lump sum benefit to the business, providing financial support to help mitigate the potential losses and disruptions caused by their absence.
Benefits of key person insurance
Investing in key person insurance can provide numerous benefits for your business, including:
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Financial protection: The lump sum payout can be used to cover various expenses, such as hiring and training a replacement, temporary staffing costs, lost revenue, or settling outstanding debts or loans.
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Business continuity: The financial support provided by key person insurance can help your business maintain operations and avoid potential disruptions or closures during the transition period.
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Stakeholder confidence: Having key person insurance in place demonstrates to stakeholders, such as investors, lenders, and clients, that your business is proactively managing risks and ensuring continuity.
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Recruitment and retention: Key person insurance can be an attractive employee benefit, helping you recruit and retain top talent by providing an additional layer of financial security.
Determining key persons and coverage amounts
At Yomo Finance, our experienced advisors will work closely with you to identify the key individuals within your organisation whose loss could significantly impact your business operations and profitability. We'll conduct a thorough assessment, considering factors such as their role, expertise, revenue generation, and overall contribution to the company's success. Once the key persons are identified, we'll help you determine the appropriate coverage amounts based on factors such as their salary, potential lost revenue, and the estimated costs of hiring and training a replacement.
We’re highly recommended
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How much can I borrow?A typical mortgage applicant can expect to borrow four and half times their annual income. This should not be affected by your employment type unless your income is low or you have a poor credit score.
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What deposit will I need?There is no specific deposit requirement needed by self-employed applicants and the minimum deposit usually needed for a standard residential mortgage is 10%. That being said, with a short trading history, you will increase your chances of securing a mortgage if you are able to offer more than the minimum deposit requirement. This can also give you access to more competitive mortgage rates.
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Do I have access to the Help to Buy scheme if I’m self-employed with one years’ accounts?All of the government home ownership schemes were created to help those applicants who would struggle to get a mortgage under normal circumstances. This extends to self-employed applicants and, although there will certainly be less availability if you have fewer years of accounts available, Yomo Finance will be able to help you. All of the government home ownership schemes were created to help those applicants who would struggle to get a mortgage under normal circumstances. This extends to self-employed applicants and, although there will certainly be less availability if you have fewer years of accounts available, Yomo Finance will be able to help you.
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What documentation is needed for a self-employed mortgage application?Tax returns, business accounts and possibly a reference from an accountant. This all depends on whether you are a sole trader, a director of a Limited Company or are in a partnership.
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How many years of accounts do I need to provide?Usually, two to three years of accounts. However, you can get a mortgage with one year's books.
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Can I get a mortgage if I am a contractor or freelancer?Yes, but you may need to provide more evidence of income stability. Typically you would need 12 months history.
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How do lenders assess self-employed income?They typically look at your average income over the past two to three years.
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What can I do to improve my chances of getting a mortgage as a self-employed individual?Keep thorough records, pay your taxes on time and maintain a good credit score. You should also limit the amount of expenses you put through in order to maximise your income.
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Are there specific lenders that specialise in self-employed mortgages?Yes, some lenders are more flexible with self-employed applicants.
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How does fluctuating income affect my mortgage application?Lenders prefer stable and predictable income but may consider averages.
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What is the impact of a limited company structure on getting a mortgage?Your income may be assessed differently, focusing on salary and dividends.
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Are interest rates higher for self-employed mortgages?They can be, depending on the perceived risk by the lender but most do not charge higher interest rates for self-employed applicants.
