Key person insurance - Business

Do you own a small business? Are you indispensable to the running of your business or do you have employees that you would find it very hard to replace? Maybe you should consider key person insurance.

Key person insurance is life insurance purchased by the company on the life of an employee or employees whose loss would have adverse effects on the company. Employees are valuable assets, and the loss of some key employees could significantly impact the profitability, stability and progress of the company.

What if something happens to your key person?

The temporary or permanent loss of a business principle or key person could see the business financially affected by:

• The loss of training, experience, and training know-how,
• The loss of customers due to the loss of the relationship with the key person, or
• The loss of credit standing

In the event of the death of Business principles that are liable for the businesses lending, there are considerable complications that could arise with the payment of the loan, especially if the business principle was a guarantor.

So what is protected under key person insurance?

The policy will cover the key person in the event of their death, total and permanent disablement or the suffering of a trauma condition by a business principle or key person. Life insurance proceeds can be used to repay debts, eliminate personal guarantees, to replace key skills of the key person and to protect revenues.

Can your business afford not to have key person insurance?

Contact our Insurance Specialist Peter Dale for more information today!