Key Person Insurance

Insurance policies aren’t just for individuals, as they can also be taken out by businesses. Key person insurance is a popular example of this and is very popular with limited companies.

What is key person insurance?

Key person insurance, also known as keyman insurance or business life insurance, protects a business from the financial impact of losing a critical individual. Typically, this individual is:

  • Owner or founder: Their skills and leadership are vital to the company’s success.
  • Top executive: Their expertise and decision-making are crucial for smooth operations.
  • Highly specialized employee: Their unique skills and knowledge are irreplaceable.

How it works:

The business takes out a life insurance policy on the key person. If that person dies or becomes critically ill and unable to work, the insurance company pays out a lump sum benefit to the business.

Benefits for the business:

  • Financial stability:  Helps cover lost profits, business continuity costs, and recruitment expenses.
  • Peace of mind:  Allows the business to continue operating and recover from the loss without major financial disruption.
  • Attracts and retains talent:  Offers key employees a valuable benefit and demonstrates the company’s commitment to their well-being.

Different types of key person insurance:

  • Life insurance: Pays out if the key person dies.
  • Critical illness cover: Pays out if the key person is diagnosed with a serious illness.
  • Disability income protection: Pays out a regular income if the key person is unable to work due to an illness or injury.
Astra Birch - Mortgage and Protection Adviser Certs CII (MP & ER)

Ask us about key person insurance

Ultimately, key person insurance can be a valuable tool for businesses of all sizes to protect themselves from the financial consequences of losing a critical individual.

Get in touch to contact us about the best options for your business needs.

 

Information given during the application will form part of the legal relationship between you and the protection provider. If any information is omitted or found to be incorrect it may mean that a claim is not paid, or the policy is amended or cancelled.

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Financial advisory in Worcestershire and Kent

Based in Droitwich Spa, we’ve proudly supported clients of all ages since 2004. The opening of our second office in Sevenoaks allowed us to extend our bespoke financial services even further, making SN Financial a trusted financial adviser for individuals, couples, families and businesses across Worcestershire, Kent and the rest of the UK.

Droitwich Office

5 Saltway, Droitwich, Worcestershire, WR9 8LB
01905 779697

Sevenoaks Office

46 Holly Bush Lane, Sevenoaks, Kent, TN13 3TL
01732 926255