Most organizations employ at least one individual who is essential to the company’s success. This person may be a partner, owner, majority stockholder or another individual who is crucial to the business. If this person unexpectedly leaves the organization—due to a death, disability or immediate resignation—it may be hard for the organization to survive. If your organization employs individuals who are vital to its success, key-person life insurance or key-person disability insurance can help protect you from chaos caused by their abrupt absence.
Who Needs Key-person Life or Disability Coverage?
Many organizations can benefit from key-person life or disability coverage, including those that:
• Have employees who would be extremely difficult, time-consuming or expensive to replace, such as central decision makers, chief executives, vital sales managers or employees whose ideas have critical commercial impact
How Does Key-Person Coverage Work?
• Employer purchases life or disability insurance for key individual(s)
Key-person Disability Insurance vs. Key-person Life Insurance
When most business leaders think of purchasing key-person coverage, they turn to life insurance. However, industry leaders point out that the chance of losing a key person to disability is 17 times greater than losing a key person to death, and the costs of hiring a recruiter to replace the key person and training him or her for a short period could be much higher than finding a permanent replacement.
Contact us to learn more about Key-Person Insurance.