A key person life insurance is one of the essential insurance vehicles for business owners to have. It’s true that your employees are your most important assets, and losing one of your key employees could harm your business and even force you into bankruptcy. If you choose to purchase a key life policy, you are protected and need not worry about the what-if scenarios.
Why Key Life Insurance Is Important
Key life insurance allows you to buy insurance for employees who are invaluable for the existence and success of your business. A key life policy buys you time to find a suitable replacement for a deceased employee without having to be concerned about your overall financial situation. It can also help ease the minds of creditors, shareholders and stakeholders of the company by signalizing them that your business won’t incur any major financial loss in the event of the death of a key employee.
How Much Key Life Insurance Costs
Generally speaking, a key life policy is an affordable insurance product, especially considering its significance. The premium depends on these factors:
- Amount of coverage
- Term or whole life insurance
- Industry and company size
- Age, gender and health of key employee or employees
Key person life insurance is a must-have for most business owners but is particularly important for small businesses and companies whose mere existence depends on just one or two employees. A key life insurance policy is a vital tool for helping your business make it through tough times and providing you with a sense of security and hope.