04: How much cover is needed?

The basic principle under insurance law is that an employer can only insure an employee for the financial cost that might be incurred as a result of their death or illness.

For example, you might decide that if a particular key person died, the additional costs to the business might be £150,000. If so, you could take out a life insurance policy up to that amount.

Or, if a key person became disabled following a car crash and was expected to be off work for a year, you might conclude that the additional costs would run to £10,000 a month. If so, you could take out income protection insurance, usually for up to around 60% of that figure.

We can help you determine the amount of cover you might need in each case.Last Updated