KEYMAN INSURANCE
Your company’s greatest assets
KEYMAN INSURANCE
Your company’s greatest assets
Keyman Insurance
If you run a business of any kind, the employees are the most valuable asset to the entire company. However, there’s no doubt that some staff members are more crucial than others, which is why it pays to protect them. Keyman insurance, otherwise known as Key person insurance, is the potential answer.
Still a little uncertain about the what’s, whys, and how’s? Here’s all you need to know.
What Is Keyman Income Protection?
Keyman insurance is a type of business insurance that is designed to protect the company should a key employee become incapacitated or unable to work. The insurance premium is there to cover the costs of replacing the staff member, any lost profits from the interluding period of transition, and other related costs that can soon equate to thousands of pounds.
When claims are made, the business accounts become the beneficiary. In this sense, keyman income protection plans provide the business with financial stability and continuity, even in the most difficult times. If you wouldn’t leave physical assets unprotected, don’t forget your key staff.
How To Utilise Keyman Insurance?
Replacing any member of staff following injury or death is tough on an emotional level. From a purely business perspective, though, less experienced employees can be replaced with a low financial impact. Therefore, it is not worth insuring them – particularly as the premiums aren’t usually tax deductible.
However, studies show that almost half of all business would not cope with the loss of a key director or staff member.
Business owners will find that keyman income protection is best used when dealing with directors, chief executives, and people that directly drive the financial performance of the firm.
What Types Of Keyman Insurance Are Available?
While keyman insurance is a type of life insurance, there are traditionally three options on offer to business owners. They are life protection only, critical illness only, and a combination of the two previous plans. All three carry the same definitions as they would for personal life insurance coverage premiums. So, you should be familiar with the terminology.
Most businesses find that critical illness insurance is essential because this is statistically more likely outcome than death. However, very few insurance firms offer policies that are exclusive to critical illness, so it’s likely that life protection will be added.
How Much Do Keyman Insurance Plans Cost?
As with any type of business insurance, the financial expenses are a critical feature when deciding whether it’s a worthwhile investment. Given that your business could be on the line should you fail to protect the right people, you should be willing to pay for the safety net and emotional security.
Insurance quotes can be influenced by many features. The age and health of the employee, along with the type of business will have an impact. Likewise, the insurance type payout coverage amount will play a big role in those calculations.
If this is something that is of thought to you and your business. Here at Active Mortgage we would advise that you speak with one of our in-house mortgage advisers about the policy. We can be contacted on 01245 850165 or by contacting us here
These articles are for information only and no advice should be conferred from the content within. Please seek independent financial advice prior to taking any action.