New research conducted by Legal & General in conjunction with the Institute of Directors, shows that the Business Protection Gap remains the same.

Research has been conducted to understand the security of assets, shares and cash flow of businesses. It shows that overall businesses are more optimistic about predicting growth and profits in the year ahead and corporate debt has reduced. However the size of the Business Protection ‘gap’ remains the same.

Legal & General carried out previous research in May 2009 with the British Chamber of Commerce, which established that the business protection gap was £1.1trillion. The new research, although not directly comparable with the 2009 research, suggests that this gap has not lessened which is surprising given the economic uncertainty that is still a big concern and one of the many reasons why businesses should ensure they are fully protected.

533 responses were received to a questionnaire sent out by the IOD in September 2010.

Approximately a third of businesses (32%) have corporate debt and those companies with 50 or more employees were more likely to have built up debt while more than 43% claimed to have no protection for their corporate debt.

Bank loans and overdrafts made up approximately 48% of corporate debt while life assurance was not recommended for almost 58% of those who had a bank loan or overdraft.

Richard Cree, group editor of the IOD Director magazine, said, “When Legal & General first approached us to discuss the issues of business risk