October 9, 2009
Protect Your Small Business Loan With Sensible Protection
If you have a small business you must have up-to-date and relevant protection to cover you in the case of bad debts, accident or even falling income.
About one in every 50 businesses will fail this year, with tens of thousands of insolvencies predicted over the next 18 months as a result of poor cash management, according to a report by BDO Stoy Hayward. Firms will find that they are short each month, and as debts increase as will the gulf between profit and loss.
Simon Featherstone, managing director of Lloyds TSB Commercial Finance, says: "Even the strongest companies can be significantly affected if a major customer suddenly fails. One bad debt can have a dramatic effect on a firm's balance sheet and wipe out years of hard work.
"A £5,000 bad debt can create a loss that could require £50,000 of turnover for the business just to stand still. We're seeing more demand from small businesses for a safety net."
The only safety net you can rely on in these turbulent times is insurance. Taking out policies that protect your income, your debts, your assets and your ability to work will make sure that whatever happens your enterprise is safe.
Talk to a financial adviser about the policies that you and your business must have. Debts can pull down a business, but so can illnesses, accidents or just bad luck – don't be a victim, get protected.
SOURCE: Lloyds TSB, 06/10/09, BDO Stoy Hayward, Summer 2009
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