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Two ways your business could be affected by a serious illness, and how to reduce the impact
20th August 2024


You might remember a famous case in which a business owner became gravely ill whilst acting as company leader: Steve Jobs, founder and former CEO of Apple.
Jobs was first diagnosed with cancer in 2003 but delayed having surgery and opted for holistic treatment instead, which, according to Yahoo Finance, he “expressed regret” about later. Over the next eight years, Jobs grappled with running Apple and attempting to recover from cancer, to which he sadly lost his battle in 2011, just two months after finally resigning as CEO to focus on his health.
As you can imagine, the pressure on Steve Jobs was huge. Not only was he running one of the fastest-growing technology companies in the world, but he was a husband and father too.
In your case, being prepared for this eventuality – whilst hoping it never happens, of course – could bring you peace of mind as you continue to grow your business.
Yet in our recent Client Survey, we discovered one of the main concerns business owners have is about what would happen if they became seriously ill whilst running their company. These feelings are understandable, but it’s important to know that there are steps you can take to mitigate the impact on your company and employees.
Keep reading to discover two ways your business could be affected by illness, and how to protect against them as best you can.
- A serious illness could prevent you from working for a year or more
A serious illness or injury could stop you from working for a long period of time, and may even prevent you from returning to work at full capacity once you have recovered.
While you may not want to take this much time away, rest could be integral to your recovery, giving you no choice but to step back from running your business for up to a year (or more).
This may have several unintended consequences, including:
- You could be required to choose an interim leader at short notice.
- Employees who rely on your leadership could need to take a more self-starting approach to their work.
- Your business may need additional team members to help make up the shortfall created by your absence, or existing employees may need to put in overtime.
- Your team may need to take extra steps to reassure concerned customers in this difficult time.
Once you are given the all-clear to return to work, there may be a chance you’re unable to go “full steam ahead” when you come back.
If you’re still recovering, or are now living with life-altering health conditions or a disability following your illness, you might need to make provisions for the long-term running of your business too.
- Your absence from work could limit company revenue
Many business owners act as the face of their business, and in your absence, this could mean customers, clients, and stakeholders become worried about your company’s future.
Such an event happened when Steve Jobs was forced to resign as CEO of Apple due to his illness. Apple had been named the world’s most valuable company only two weeks before Jobs’ resignation, but after he left, a Guardian report says that the event “wiped billions of dollars off its stock market value”.
While your business may not be listed on the stock market, small- and medium-sized businesses often struggle when the company leader is absent. Customers may feel unsettled and go elsewhere, and you may have additional expenses from hiring new team members or paying overtime to employees who want to do their bit.
In any case, it could be wise to consider how an illness may limit company revenue before it ever happens, so you can make a solid plan of action just in case.
How to protect your business if you’re absent over the long term
With regards to the potential revenue loss, if you had to step back due to illness, it may help to take a “belt and braces” approach.
In part, as you read above, this includes choosing a strong successor ahead of time. As the Guardian reports, Steve Jobs was replaced by Tim Cook in 2011, a “respected” man who made shareholders feel the company was in “safe hands”. The proof is in the pudding – Cook is still the CEO of Apple as of August 2024, and the company remains one of the key players in the technology industry.
So, choosing a person who would act as leader while you’re off with illness could put your mind at ease. Rather than rushing to find a suitable person when you’ve already been diagnosed with an illness, having this plan in place now may make the transition smoother.
In addition, it may be helpful to start building an emergency fund within your business that could cover any immediate losses from unexpected events.
On top of this, financial protection can act as a safety net so that whilst you’re away over the short term, any loss in earnings may be covered. This cover might help to boost the longevity of your business and ensure that it can recover from the period of turbulence caused by a serious illness.
Forms of protection you could consider include:
- Business interruption insurance, which offers an injection of capital into a business after an unexpected event (like a serious illness or injury in the senior leadership team) interrupts the revenue stream.
- Key person cover, which covers you and other integral employees against illness or injury.
- Critical illness and income protection insurance, both of which may shield your personal finances from the hit of an unexpected illness.
- Ownership protection insurance, in which each owner of the business takes out individual protection that covers their share of the business in case of death or illness.
A Financial Planner can help you form a bespoke package of protection that meets your company’s needs with pinpoint accuracy.
Get in touch to find out more about protecting your business from a potential illness or injury
We understand that your business is precious to you, so it makes sense that you want to protect it against life’s most unexpected events.
To work with one of our experienced Financial Planners, email us at enquiries@pen-life.co.uk, or call 01904 661140.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only. All information is correct at the time of writing and is subject to change in the future.
Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product provider and will be explained within the policy documentation.
Category: Protection