Business protection "gap" is £1.1 trillion

Date: 16th June 2009

New research conducted by Legal and General has redefined the Business Protection "gap" as being £1.1 trillion.

The "gap" is made up of a £300 billion corporate debt gap, a £400 billion shareholder protection gap and a £400 billion key person protection gap.

The study showed that 44 per cent of business owners felt their company would not survive more than 12 months following the death of a key person.

Only four per cent said they have shareholder protection and 48 per cent have no contingency plan for the death of the owner.

Clare Harrop, Legal and General's head of specialist protection, said: "This is a big day for the business protection market.

"We now have up-to-date figures showing just how few businesses are prepared to handle an event such as the death or critical illness of a key person or business owner."

Ms Harrop went on to suggest that it was the protection industry's responsibility to "close that gap" and believed the opportunity to do so was there.

It is the first time since Swiss Re's research in 2005 that an organisation has conducted the study.