Key Man / Key Person Life Insurance
>Key man or key person insurance is insurance purchased on the life of a key employee or owner of a company.
>It's needed to prevent lost sales or revenue, and hiring of interim staff until a permanent replacement is found.
How Does It Work?
>Replacing a key person takes time and money and could possibly cost the business valuable clients during the transition.
>The tax-free policy proceeds from key person life insurance can cover financial losses that occur at the death of a key person.
>This helps assure continuity of the business for employees, customers and creditors.
>It can serve to affirm the key person’s value to your business, which may strengthen the relationship.
Why Buy Key Man Life Insurance?
>Coverage is a business asset that enhances your company’s creditworthiness for commercial borrowing.
>The policy’s cash value may be available to your business through a withdrawal or loan if needed.
>The policy can be transferred to the employee at retirement as a bonus.
>The business pays the premiums and they are non-deductible.