Running a business often means taking financial risks such as loans, credit lines & supplier agreements are all part of keeping things moving.
But what happens if your business can’t pay its debts?
Many directors and business owners don’t realise that signing a personal guarantee (PG) on a loan could put their own assets (like their home or savings), on the line.
What is Personal Guarantee Insurance?
Personal Guarantee Insurance is an annual insurance policy that provides insurance cover for Personal Guarantees provided by Directors of Limited Companies in support of business loan facilities.
If the company enters insolvency, the Policy steps in and pays a set percentage of the PG commitment directly to the lender.
Asset Finance, Invoice Finance, Property Development, Business Finance, Overdrafts, Commercial Mortgages, Property Bridging
Premiums are based on the financial strength of the Limited Company the following aspects are considered by underwriters:
Shareholders funds, directors experience, lender, cashflow, profitability and trade sector.
What does the Insurance Policy provide?
- Cover for PGs signed in support of secured finance and unsecured finance
- Cover increases each year you renew
- Unlimited access to the Business Support Service which provides invaluable support during financial difficulties.
- Cover for a professional debt negotiator to arrange settlement with the lender
- Cover for multiple Directors on one Policy at no extra cost if the PG is signed on a joint and several liability basis
- Cover for multiple guarantees on one Policy
What cover can you get?
PGI offers tailored protection based on the type of loan. For secured loans, PGI provides coverage of up to 80% of the personal guarantee amount, while for unsecured loans, the coverage increases progressively over time, starting at 60% in the first year, rising to 70% in the second year, and reaching up to 80% from the third year onward.
This incremental approach ensures that directors and SME owners benefit from expanding protection as their loan matures. The maximum protection available under PGI is £750,000 for secured loans and £500,000 for unsecured loans.
Key Features Include:
1. Competitive premiums and cover available across a wide range of business loans
2. Insurance available for: a. Existing or new Personal Guarantees b. Multiple Personal Guarantees c. One or more guarantors
3. Unlimited access to Business Support Services; a group of specialist advisors who are at your side should your business need support
4. Full quotation in minutes using the online quote and buy system or via telephone with one of their specialist advisors
Protect yourself before it’s too late
So, if you’ve taken out business debt and don’t have PG insurance in place, now’s the time to act.
One conversation could make all the difference between financial security and personal risk.
Why not message us today to arrange a quick call?
We’ll walk you through how PG insurance can help protect you, your home, and your family.
Giving you confidence that your personal future is secure, no matter what happens in business.
