Key person insurance (also known as key man insurance), ensures that the business is financially protected from the loss or absence of the people/person who are so crucial that their extended absence would see a loss in profits (or even just a more general financial loss from recruitment and training of a replacement, customers losing confidence in the company or loss of contracts established by that key person).
Key person insurance protects your business from the financial losses it would suffer should they key person, or people, covered die unexpectedly or be diagnosed with a terminal or critical illness during the length of the policy. The business must demonstrate that the it stands to suffer a significant financial loss and in the event, payout is payable directly to the employer.
The loss of a key person to a business could have a huge impact, not just financially but also in the general day to day operations – possibly even resulting in the closure of the company.
Not only does key person insurance provide a financial safety net, it allows the business to focus on other issues that could arise due to the key person being incapacitated.
If you are a small business and would like to discuss key person insurance further please contact one of the First Financial Solutions team by calling 01639 262222 or email Chris by clicking here.