What Strictly Come Dancing can teach us about key person insurance

There are some roles that seem difficult to imagine anyone else doing. Whether that’s the lead singer in a band you love, the most valuable player on the football team you support or even the hosts of your favourite TV show.

Now that Strictly Come Dancing has returned to our screens with three brand-new presenters, it's made us think about how some people can become synonymous with a successful show or business. But what happens when they leave?

Tess Daly had been co-hosting the programme since the very beginning. Originally with Sir Bruce Forsyth until he stepped down in 2013 and Claudia Winkleman became the new co-host. Together, they became familiar faces that viewers looked forward to welcoming into their living rooms each week.

While the celebrity contestants change every season, for many viewers, the presenters, judges and professional dancers are some of the few constants and are a huge part of what makes Strictly… Strictly. They help give the show its identity and bringing familiarity and continuity year after year.

Businesses often have individuals who play a similar role. They become trusted by customers and suppliers and help shape the business’ reputation and are key to its success.

Of course, realistically, any role can be filled eventually. But when someone who's become such a recognisable and trusted part of an organisation leaves, there's always a degree of uncertainty. And if audiences – or in a business’ case: customers – don’t respond well to the change, the impact can be huge.

When people think about who the most important person is in a company, they often imagine the owner or a managing director – but they may not be the hardest person to replace.

Sometimes the person a business would struggle the most to lose is someone who doesn’t necessarily have the fancy job title. Perhaps an operations manager who keeps everything running smoothly and on time. Or an account handler who has put in the time to develop strong relationships with major clients over the years. Perhaps it’s an employee who has specialist insight. Or a team leader who knows how to get the very best out of their team and would be tricky to replace.

These are often the people whose absence creates chaos almost instantly. They’re usually the people that colleagues turn to when they have a question, or that customers ask for specifically because they know they can trust them.

These are the people who often drive revenue and build relationships with customers. Although they might not always be in the spotlight, they are the ones that a business would struggle to cope without if they were suddenly unable to work.

Unlike Strictly, businesses don’t have the luxury of having a week between live shows to regroup. If a key person gets ill, injured or passes away suddenly, it can have an immediate and noticeable effect on your business’s output.

Projects might suddenly stall, customers might feel uncertain and even your revenue could be impacted.

Usually it can be costly to recruit and, even when a replacement is found, bringing a new hire up to speed can take time. When it’s a key person being replaced, this will probably take even longer.

This is when having key person insurance becomes invaluable.

Key person insurance is designed specifically to help businesses cope if a key person leaves or can’t work. So if you have a member of your team whose absence would have a financial impact on the company, this can be a worthwhile investment.

The insurance can help offset any lost profits, recruitment costs and provide reassurance for investors while the business works out the best way forward. It's important to understand that key person insurance isn't designed to replace the employee's personal income or provide compensation for the employee’s family. Its purpose is to provide financial support to the business and help it manage the challenges that can occur when it loses a key member of the team.

One of the biggest misconceptions with key person insurance is that only large organisations need it. Really, it’s often small businesses that are more exposed to risk because they tend to rely heavily on a small number of people to wear multiple hats across the business. This can mean that the key person’s absence is felt across the entire business rather than in just one department.

Of course, every successful business is a team effort. And just like Strictly, nobody wins entirely on their own. That being said, most businesses do have individuals that would be difficult to replace overnight and whose contribution may be more valuable than it seems at first glance.

It’s usually easy to see who those people are, and there may be individuals springing to mind even as you read this. The challenging part is thinking about what you’d do if they weren’t there tomorrow when you clock in for work.

So, while you might not need to worry about mastering the Charleston or getting a “fab-u-lous” from Craig Revel Horwood, it’s worth taking a moment to think about your own business’s performance.

Ask yourself: Who are the key people behind your success story? And if they were unable to work, would your business be able to cope?

The information contained in this article is for general information purposes only. It does not constitute legal or other professional advice and cannot be relied upon as such. Should you have any queries, we recommend that you consult the appropriate professional adviser. The links provided in this document are for reference only. Please note that we are not responsible for the content of any linked site.